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Inside Labour: Marx, Keynes & the economic policy pendulum

KARL Marx must be spinning in his grave in London’s Highgate cemetery: his name, with an apparent nod to his ideas, has been quoted approvingly at a conference of institutional investors in New York.

However, this should not be surprising since the economic policy pendulum seems to be swinging away from laissez-faire to regulation, from the ideas of Milton Friedman to those of Maynard Keynes.

The appropriation of Marx in this context sends the message that there is no alternative to the kinder, paternalistic capitalism proposed by Keynes; that the current economic system is merely in need of reform and repair and not wholesale transformation. 

What is of particular interest is that the main speaker at the New York conference was South Africa’s Finance Minister Pravin Gordhan, accompanied by a delegation of business and trade union leaders. And it was one of the trade unionists, Federation of Unions general secretary Dennis George, who introduced Karl Marx to the assembled money moguls but as a harbinger of collaboration, not as an opponent.

Standard Bank CEO Sim Tshabalala reportedly noted that this reference was the most memorable moment of the conference. But it tied in with his own analysis: that while capitalism is extremely dynamic, it could also worsen inequality and instability, a sentiment with which Marx would have agreed.

As a consequence, Tshabalala felt that “wise capitalists” should reach out to social partners to ensure stability, “shared prosperity and broad national development”. The leading social partners in this case would be the unions and what this statement amounted to was: we’re all in the same boat, we must row together in the cause of nationalism, patriotism and against some common enemy. 

This plea is increasingly being heard from business tycoons, politicians and mainstream economists - the effective manipulators of the economic policy pendulum - as they try desperately to find ways to maintain the system while attempting to claw national economies out of the mire of increasing joblessness and social instability. And it is not new.

In the years before Ronald Reagan in the United States and Margaret Thatcher in Britain became the figureheads and praise singers for global neo-liberalism, such calls for collaboration were the dominant theme. Now they emerge again as the monied minority becomes increasingly concerned about social stability.

And, as George pointed out this week, there are higher levels of productivity and stability in countries such as Norway, Sweden and Austria where worker-directors are commonplace. But in such cases - Germany is also an example - the worker voice is a minority in the boardrooms. As such, it has been criticised as little more than window dressing that only provides some perhaps more substantial crumbs from the tables of capital.

However, such collaborative concessions by capital - and talk now of extending the practice - could open up the debate about the best, most efficient, stable and productive way of owning and managing the means of production, distribution and exchange. And that might truly bring in the ideas of Marx, who promoted the concept of democratic worker control. In other words: complete transformation.

As such, the examples that should be looked at, even within the present competitive, profit-orientated system, are those such as the John Lewis Partnership in Britain or, perhaps better still, the FaSinPat (Fabrica Sin Patrones - Factory Without Bosses) ceramic works in Argentina. Both provide clear evidence that private ownership and stock exchange listings are not necessary for a productive and successful enterprise to exist and thrive.

The John Lewis Partnership, for example, is the third largest private business in Britain and is owned, via a trust, by its 91 500 employees. FaSinPat is directly run by the workers in collaboration with their community.

* Add your voice or just drop Terry a labour question. Follow Terry on twitter @telbelsa.

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