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Editorial: Corporate capitalism can’t overcome this crisis or future ones

WELCOME to begging-bowl capitalism. After decades of free-market rhetoric, when the captains of industry demanded freedom from the shackles of state intervention and regulation, they are lining up for yet another package of public money from Britain’s central and devolved governments.

Already, more than £330 billion has been devoted to helping private enterprise survive the coronavirus crisis. 

Now some of the biggest companies, such as Tata Steel and Jaguar Land Rover, are banging on the Treasury door pleading to be put on the Chancellor’s life-support system for an indeterminate period of intensive care.

There, the parallel with NHS patients in ICU beds comes to an end. Unlike other victims of the pandemic, Britain’s corporate fat cats are trying to dictate the terms of their treatment. 

They want money with no strings. Failing that, they will settle for loans at low or no interest. 

But they do not want to hand over equity shares in return for the cash. 

It’s a strange twist on the Dick Turpin demand: “Stand and deliver, or I’ll shoot myself.”

Not even the banks tried that line when the government, Treasury and the Bank of England bailed out the entire financial system following the 2007-8 crash. 

In fact, as well as providing loans, underwriting debts and buying back bonds through “quantitative easing,” the government also bought substantial equity in a number of banks and building societies. 

Unfortunately, these state shareholdings were not subsequently used to turn those wholly or partly state-owned institutions towards policies that put the interests of the economy and society above those of private and corporate shareholders and creditors.

Once those bailed-out enterprises could make a profit again, the public shareholdings were sold off to the same capitalist chancers whose main or sole interest is in their share dividends.

Not that this should come as a surprise. Lenin and others described many decades ago how, in the most developed capitalist societies, the political power of the state had fused with the economic power of the giant corporations to produce the system of “state-monopoly capitalism.”

The protestations of neoliberal capitalists, their theorists and propagandists about state “interference” in the economy was always just that — propaganda. 

They object to public ownership, planning, regulation and corporate taxation because these threaten to interfere with the mission to maximise profits. 

Enthusiasts for neoliberalism did not object to all those economic, social, political and military policies of the state which assisted that drive.

Well, it seems they are all welfare capitalists now. The problem is that they hold the fate of millions of workers in their hands. They cannot be simply turned away at the door.

The government should insist that any substantial injection of public money into private-sector corporations must be in exchange for voting shares. 

Should strategically important companies refuse and announce mass redundancies or an application for receivership or bankruptcy instead, they should know the consequence: nationalisation, with means-tested compensation and a full investigation of the past management of the company’s affairs.

There will be future economic crashes, health pandemics and other emergencies. Corporate capitalism is incapable of meeting these challenges. 

State intervention should be but the first step towards a revolutionary transformation of the economy upon which we all depend.

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