Climate, technology and chaos Blog

In the beginning, perhaps neoliberalism did have a belief in the virtues of private enterprise and in government inefficiency, but after 40 years of mess and profiteering, this can hardly be the case any more. For a long time it has been clear that privatisation exists to transfer public assets, public profit, taxpayers’ money and political power to the corporate sector.

Some of our local neoliberals use the term “Asset recycling” instead of privatization. This term shows the whole farce for what it is. There is no recycling. These assets are not waste that is being given to the private sector to revitalise, but are viable, useful and often profitable parts of public infrastructure and organisation that are being taken away from us precisely because they are useful, viable and profitable. How stupid does he think we are?

Even the supposed virtues of private enterprise are crushed by privatisation, as with the NSW Ports deal when competition between ports is suppressed by contract and legislation so as to benefit a favoured company. Many of the organisations that are privatised are monopolies, and there is no possibility of competition between the monopoly and new market entrants – for example airports, airport parking, or airport trains. The expense of building a competing airport is tremendous and unlikely to happen even if planning approval was given. The electricity grid also seems to be a monopoly for the same reason; the cost of setting up a new universal grid is enormous. So there is no competition with plenty of scope for profiteering.

We all know how well privatisation of the Commonwealth Bank has worked for the public good. The publicly owned bank provided competition, now the banks are in lock-sync to increase profits. In the old days, banks paid you to get access to your money, now with all the cost cutting allowed by the internet and computerization, and branch closure, you pay them to look after your money – and you cannot avoid using them.

Privatisation involves both surrendering power to the private sector, and over-valuing the private sector, so that what was once controllable in the general good, becomes sacrificed to profit and non-existant “private efficiency”, and what was public information which allowed performance to be evaluated becomes “commercial in confidence”.

Yes, that is right tax payers’ money goes to the private sector and we, the taxpayers, are not allowed to know how the money is spent, or whether its an improvement. As for selling the titles office, how secure is that now? We the taxpayers have to bail out these private organisations when they do stupid things. So where is the benefit? The profit goes to them, and the costs to us.

I read today, that some companies that benefit from neoliberal largess, such as Sydney Airport and Transurban (the latter receiving the gift of toll road Westconnex) have not paid taxes “since 2013-14 despite reporting billions of dollars in income” (‘One in four of Australia’s largest companies paid no tax last year’, SMH 13 December 2018). So these companies freeload even more on the rest of society, paying nothing to support the conditions that make them profitable. So its a total loss to the public.

Where does the money raised from privatisation go? Not to public coffers, but to other private companies, like the people running roughshod over the public in the way of Westconnex, which is then to be gifted to a toll company so that we not only give money to the private sector but we have a permanent tax on travel in Sydney.

Some money goes to massively inflated and useless rail projects which cannot merge with the overall rail system, and again have no competition. Indeed the sole purpose of some of these projects is to provide transport for development projects, while not serving other areas on the route.

The new privatized hospital in North Sydney is way too far from the Northern Beaches for safety. You will not get there in time if you have a stroke or heart attack, whereas you could probably have got to the hospitals which are being closed and sold off to developers. Can’t have nice land and views in the public domain or being used by ordinary sick people. The hospital is crashing already. People will end up with worse, and distant, service so that corporations can profit (in this case from people’s suffering).

All of this privatisation does help lower general wages and boost executive wages, because of the way these companies work and structure their income. – this the neoliberals think is a good thing. Thus the economy becomes depressed, because those who need money, and spend it, don’t get it.

These “shortcomings” are not minor as the author claims. Turning things over to the market only delivers profits for high-level executives, lack of information for the public (through commercial in-confidence arrangements), and pollution and destruction of the environment, air space and living space more generally. They turn power and public money over to the wealthy, and abdicate the general good and the idea of commons. They destroy the democratic process, and that is the whole point of neoliberalism.

The neoliberal right will not change their minds and stop privatization, because for them it was always about handing public property to the private sector, higher pay for corporate elites, the freedom to damage things without constraint, and freedom from challenge by the people.

“Primitive accumulation” is a somewhat confusing Marxist term for pre-capitalist modes of accumulation. Primitive accumulation is the accumulation, and breaking of social bonds, necessary to raise the capital to make private investments. The term points out that capitalism does not start off with a blank slate and that the accumulation of capital did not simply arise because some people worked harder, or had more talent, than others.

Capital/capitalism arose out of several pre-existing processes, such as:

None of these processes by themselves guarantee capitalism, but the people who can do this violence to create capital, can come to make a ruling class, capture the State, and instigate legislation to allow their violence to be sanctified by law.

Ideals of private and bounded property are developed to stop those who have been dispossessed from taking their property back. Wages become ways of the business owning what the wage earner produces or creates. The ecology becomes something to be plundered and dumped on until it starts to fail. The ruling class usually get a religion, or form of economics, to support all this violence as non-violent evidence of God’s will and the natural talent of the despoilers etc.

Primitive accumulation does not stop with the birth of capital, and even today wealthy people are given public lands cheap, the power to pollute and poison, companies can use the courts to deprive others of property, they bribe state operatives for powers to despoil and steal etc.

Inquiries in Australia suggest that it is standard for businesses to defraud customers, and defraud their workers of promised wages. Yet despite this, it seems rare for someone at a high level in the business to suffer for this theft; the worse that happens is that the business has to pay it back sometimes. On the other hand, theft from employers is treated quite seriously, people go to jail for that. Capitalism legitimates and encourages ongoing primitive accumulation. In the 2008 financial crisis we could frequently read about forged, or heavily misleading, contracts, and it was the customer who lost their homes, the banks were given taxpayer bailouts and sold the homes from under people.

Corporations are tools whereby the owners and controllers avoid responsibility and liability for the results of their actions, frauds and thefts. Who benefits from this system is clear.

Competition can exist, but only to the extent that it does not threaten the rulers and buyers of state power, as a whole. Businesses often collaborate to charge the maximum price and the lowest wages, as that is what the system rewards. They try and repeal any legislation which may have given workers or independents any comeback against them.

Supporters of corporate power, argue that the State should support even fewer people in their ability to challenge capitalist power, and that the state should give more power and more rewards to those with wealth, and we end up with something like we have now.

Capitalism requires a State, and will always build a State, in order to function and protect its capital and its property. There is no such thing as anarcho-capitalism, other than as an ideology which functions to hand over more of the State to the corporate sector

Let’s be clear we don’t know exactly what would happen, but we can predict based on what happens in plutocracies generally. What we do know is that Libertarians tend to equate wealth with virtue and poverty with laziness and vice. They also refuse to admit that wealth is a source of power, and that people should be allowed to constrain that power. Consequently we can assume that the general trend would not be good.

Poor people could get employment that was radically unsafe and harmed them because nobody could make employers think this was a bad idea, and there are always more poor workers to use up. This is what happens in unregulated industries.

Workers would have to obey bosses totally or starve, because bosses like power with their wealth – and bosses club together while making unions illegal.

They could buy food that poisoned them because there would be no restrictions on selling it, and no requirements to list ingredients, and food business would love this, and agitate for it all the time.

Farm subsidies would be eliminated putting small farmers out of work, and allowing their farms to be taken over by ‘big agriculture’ and possibly increasing the price of food. One of the main drives of capitalism has been to displace people from self-sufficiency and offer them the choice of wage labour or poverty – or both – as this increases the power of wealth.

Poor areas would get even more pollution than they do now, because wealthy people could dump it all on them, and there would be no recourse.

Poorer people would be continually hassled by privatised police forces that worked solely to impose the whims of those who could afford them – and there is no recourse again.

Police could kill poor suspects with even more ease as there would be no regulations to stop them, and relatives probably would not have enough money to hire a rival police to fight it out.

Probably everyone who could afford police and law could kill anyone who was poor. It might even become a sport.

Random people would probably be sent to prison as private prisons would make money from them without restriction, and they could pay the private police forces to collect workers for them.

Education would not be free or cheap as restrictions on education helps maintain class lines. If you are poor give up all hope of education for your kids. Or you could be taught at charity schools about being respectful to business and knowing your place when a rich person passes by.

Science counts for nothing, unless it increases wealth, so there may be free range on ‘consensual’ human experimentation – on paid victims with commercial in confidence clauses and penalization for speaking out.

Only knowledge that supports the ruling elite, or which sells advertising, would be widely available to poor people, so the poor would have little understanding of what was causing their problems. Informing them about reality would make you a class traitor, and you might disappear.

There would be nothing like the GI bill, so no reward when you go to war to protect markets and cheap labor.

People would say the poor are always with us, and that attempts to do anything to improve people’s opportunities would corrupt them.

Charity would be about forcing people to give respect to donors, because its not like you deserve support – your inferiority is shown by you needing it, and you have to encourage donors by boosting them.

Poor people in ill health, or orphans, might be locked up in institutions to force them to work, for someone’s profit – this how charity used to work.

As class/wealth lines would intensify, there would be less mass production, because there is no point in trying to sell stuff to people who can’t afford it. Money would be better made selling one-off vanity products to the rich.

Libertarianism is not anarchism, never forget that.

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Adendum

In late 2021, in response to this post, someone asked me why I would assume there would be no rules about what can be sold, and protecting people against harmful or bad work environments in libertarian society, They also pointed out that forms of what I was pointing to already exist, and that other societies, such as communist societies are very bad.

My response is: