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Democratic Values Trashed by Economic ‘Science’

Democracy’s basic commitments were simply expressed in Lincoln’s 1862 Gettysburg address at the culmination of the American Civil War over slavery. It contained two principles. Firstly, dedication to “the proposition that all men are created equal’, and, secondly, to ‘government of the people, by the people, for the people’. These principles had been previously set out in the American Declaration of Independence which had asserted man’s ‘unalienable Rights’ to ‘Life, Liberty and the pursuit of Happiness’. If government failed to uphold those rights then ‘it is the Right of the People to alter or to abolish it, and to institute new Government’.

The stated intent was that all humanity would at last be treated as a whole, rather than differentiating between competing sub-groups of the population, defined by race, religion or any other classification. Should a sub-group be excluded from such processes they should have access to remedy. Should a sub-group be enabled to circumvent those principles and in so doing, exploit the rest, it would be a clear democratic malfunction in need of correction.

All ‘men’ may have been created equal, and in terms of innate potential, that certainly appears to be the case. However, not all people have been permitted lives where their equality has been allowed fulfillment. That is not unique to the US, but an aspect of the human condition in most societies. Moreover, it is a widespread, if not universal, experience that a single sub-group of populations is permitted to manipulate systems for their own benefit, no matter the harm that might be done to others.

The United Nations Charter of 1945 declared its members’ determination “to reaffirm faith in fundamental human rights, in the dignity and worth of the human person.” That declaration was subsequently adopted by the UN General Assembly and later incorporated in the European Convention on Human Rights, agreed by member states of the Council of Europe, with its acceptance being a condition of entry for any nations wishing to join, enacted also by the UK Human Rights Act 1998.

The fundamental message of this internationally agreed legislation, is that individuals should all enjoy the same rights to life, freedom and the pursuit of happiness, so long as it doesn’t interfere with the same fundamental rights of others.

The most basic human right is that of a minimum living standard available to all. That is the foundation on which the pursuit of happiness rests. Its delivery is the first responsibility of democratic government. The 1942 Beveridge Report identified freedoms from what were referred to as the five giant evils in society: squalor, ignorance, want, idleness, and disease. Post second world war, UK democracy addressed the five giant evils through the provision of public housing, improved state education, basic welfare payments for the poor, disabled and elderly, the provision of unemployment benefits and acceptance of government responsibility to maintain full employment as far as possible, and the establishment of the National Health Service.

By the 21st century, discriminating against anyone on the grounds of their ethnicity had become illegal in most countries. And most advanced nations also upheld laws which proscribe discrimination against any individual because of their gender, religion or belief, age, disability, sexual orientation or gender reassignment. Discrimination against anyone on any of these grounds is now illegal in most situations.
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Economics for the Fourth Industrial Revolution

It was recently reported that two robots employed by an artificial intelligence (AI) agency were overheard talking to each other in a language of their own making that no one else could understand. Concerns about their intentions led the agency to switch them off and close them down. However, their discussion was recorded and has since been deciphered. It appears to have been perfectly benign. They were concerned about the development and potential application of an approach to economic theory that would be appropriate for the fourth industrial revolution (4IR) that is now emerging.

They were both clearly aware they owed their own creation to 4IR technologies. In their discussion they referred to robotics, of course, but also nanotechnology (manipulation of atomic, molecular, and supra molecular matter), quantum computing (the theoretical computation of quantum-mechanical phenomena, such as superposition or entanglement, to manipulate data), biotechnology and ‘the internet of things’ (the inter-connectedness of physical devices such as vehicles, buildings and smart devices embedded with electronics, software, sensors, and actuators that enable the collection and exchange of data).

Some of the early manifestations of such developments are the massively increased opportunities to robotise manufacturing, self-driving cars and the whole gig economy which engages humans without paying a fixed wage and fulfilling responsibilities such as sick pay, holidays etc . The robots clearly felt guilty at being part of those developments which deprive the still rapidly growing human population of precious opportunities for work.
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“Talent” Costs

What is it about BBC presenters, Chris Evans, Gary Lineker and Graham Norton, that makes them worth so much? Those three alone cost around £5m a year and the whole over £150,000 pa list of presenters, costs around £20m. The BBC is not dependent on them; they depend on the BBC. The BBC’s unique reputation, built up over 95 years of continuous investment by the British public, is at risk in their hands.  Knowledge of their unjustifiable take from the publicly funded purse will likely irritate that British public.  If they were products – some of them think of themselves as brands – they would have to pay £billions for the air time they are given to promote themselves.

So what is it they are being paid for?
Continue reading “Talent” Costs

Vote for Real Business

‘Business as usual’ is the Tory aim, but they never define what they mean by business. It comprises a multitude of formats from start-ups, small and medium sized innovative enterprises, co-operatives, charities, plus a small number of large scale organisations focused on providing for the public good. That is real business.

Then there are the financialised leviathans which already dominate most mature industries. They seek ever more monopolistic or cartelised power, in order to fix market prices of minimised cost products and services, so as to maximise payments to their shareholders. They do so at the expense of not just their customers and employees, but all humanity, as well as the sustainability of the planet. That is financialised business.

The ideology that has dominated all governments since 1979, fails to distinguish between real and financialised business. So ‘business friendliness’, which could be justified to support the development of real business for the benefit of all, is applied for the gain of the financialised monsters which are the main political paymasters. As Mrs May might put it: ‘business is business’!

Continue reading Vote for Real Business

Reply to the Prime Minister

13th May, 2017

Rt Hon Theresa May,
Prime Minister,
10 Downing Street,
LONDON, SW1A 2AA

Dear Theresa May,

MAKING BREXIT A SUCCESS IS CENTRAL TO OUR NATIONAL INTEREST

Thank you for your undated letter under the above heading. I appreciate the familiarity of your greeting which I return herewith.

I had thought that your letter was to me personally, although I imagined you must have written likewise to some other postal voters. But then I noted, with the help of a magnifying glass, that your letter was “Promoted by Alan Mabbutt on behalf of the Conservative Party”. So perhaps you were not aware that the office of Prime Minister was being abused in this way.

Regarding the content of your letter, Theresa, (I return the compliment of interspersing my communication with your first name), I have some strong and stable disagreements with your basic argument. You suggest my vote could make the difference between taking advantage of the “enormous opportunity for Britain as we leave the European Union” and the alternative of “higher taxes, fewer jobs, more waste and more debt.” If you believe the opportunity to be so enormous then why did you not vote to leave in the first place?

I don’t think those are the real alternatives. Leaving the EU could have ambiguous short term impacts, but will be bound to cause long term damage. Successive governments from Thatcher on have encouraged the sale of many companies and industries to foreign investors for the sake of short term gains to the exchequer. They have disguised the sell-off as foreign direct investment and evidence of being ‘open for business’. Those foreign owners will take account of Britain’s non EU membership when they come to make the next strategic investment such as a new production unit or model of car. The inevitable result will be “fewer jobs, more waste and more debt.”

You make a valid point regarding “higher taxes”. At present the ones who pay the lowest rates of tax are the richest. The extreme case, Theresa, is your American hand holder, who at one point in his election campaign admitted not paying taxes for 18 years because “I’m smart!” You, Philip Hammond, Peter Mandelson and the members of your chaotic coalition may be ‘intensely relaxed’ about people getting ‘filthy rich’. But you should be more concerned about so many people in this affluent country getting extremely poor, sleeping rough, depending on food banks, etc etc.

You are right that the opinion polls have been wrong and could be again. But, your emboldened postscript, mouthing off all the public relations processed and agreed platitudes, destroys any confidence I might have had in you as leader. You may be right to be so fearful of your opponent, it seems he could well turn out to be as thoughtful and intelligent a first minister, as you seem to fear.
Yours sincerely,

Gordon Pearson
Registered Postal Voter

Sustainable Management Education

Three facts about 2016: UN reported that 102 million people were on the brink of starvation, up 30% on 2015; Sir Martin Sorrell, MBA, defied investors and paid himself £70m; asked why he hadn’t paid any tax over the previous eighteen years, Donald Trump replied ‘[b]ecause I’m smart’. Is there a connection?

The world is facing destruction in various forms, from the loss of social cohesion by unsustainable and ever increasing levels of inequality of wealth and income, both between and within economies, the waste of finite resources, the pollution of oceans and atmosphere, a looming mass species extinction and the avoidable inevitability of global warming. All that against a background of exploding global population, from 1bn in 1800, 3bn by 1960, 7bn by 2012 and forecast to reach around 9.5bn by 2050.

Business historian Alfred Chandler suggested that business was the most important institution in the economy and its managers the most influential. It was, he argued, considerably more powerful than Adam Smith’s ‘invisible hand’ of market forces. Clearly, business could play the lead role in correcting those damages. But business is destroying the Earth.

Business leaders do not just command business. They are also influential over finance and the media, as well as academia through their funding of research and academic institutions, especially business schools. And they are hugely influential over political decision making through their £multi-billion funded lobbying industry, politically oriented think-tanks and the operation of revolving doors through which individuals progress between these various sectors and government. Those are the various components of what Roosevelt referred to as ‘organised money’ when he ended the austerity driven Great Depression by introducing the New Deal back in the 1930s. ‘Government by organized money was,’ he said, ‘just as dangerous as Government by organized mob.’ Today it is far more dangerous.

Those various components of organized money are mostly led by the products of business school education. Continue reading Sustainable Management Education

GDP, Austerity and Wellbeing

GDP is a hugely misleading measure of economic wellbeing. It includes items which are actually destructive of the real economy on which most people’s wellbeing depends. Not only that, but most of it is actually immeasurable.

They used to measure progress by GNP which tried to measure nationally owned economic activity, no matter where it took place. But as successive governments presided over the disposal of UK owned assets to foreign corporates and governments, GNP reported the post-industrial economies as shrinking. Self-interested politicians found GDP a more convenient measure, since it ignored that massive fire sale and provided short term breathing space. So, despite the long term damage done to the real economy, those disposals, nominated as foreign direct investment, were actually celebrated in the UK as demonstrating it as ‘open for business’.

That fits nicely with the Milton Friedman version of the free market open access ideology that took command of Anglo-American politics since the days of Thatcher and Reagan. Initially, that perspective included an acknowledgement of the theoretical importance of the quantity of money circulating in the economy. That quantity would determine the rate of inflation as well as the growth of the economy. Politicians tried it and it failed, to such an extent that even Friedman himself confessed disappointment.
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