We’re living through something of a backlash against the free market, to put it mildly. The Conservative party – in recent decades the best vehicle for liberal market values – has taken it upon itself to introduce measures such as the digital services tax, which hurts upstart tech firms but resonates with people fearful of big data and artificial intelligence.
Much of Jeremy Corbyn’s popularity has come from false preaching that the free market doesn’t work for the day-to-day worker, for young families, for students.
Indeed, one of the top priorities for Brexit voters in the 2016 referendum was ending freedom of movement.
For a majority, instinctive support for capitalism just doesn’t sit right. But to say that it doesn’t work for individuals is simply false. After all, the Economist estimated as far back as 2013 that capitalism was responsible for raising nearly one billion people out of poverty.
Since embracing the global market, China has been a world leader in alleviating poverty, which should be the main aim for everyone (rising inequality is due more to questionable social policy and approach to redistribution).
Disruptors, enabled by open, competitive markets, have driven down prices for consumers – and lower taxes have put more money back in people’s pockets.
So, it isn’t capitalism that people have a problem with, and it isn’t capitalism that is causing issues for Theresa May’s just-about-managing demographic. After all, people like lower prices for better quality and having more control over their own finances. Politicians with lobbyists on their backs may not like to hear it, but the issue people have is cronyism.
We see big business not paying taxes and wielding disproportionate influence over the political process. We don’t like the idea that Facebook, Google and Amazon influence so much of people’s lives, while shutting out competition.
The problem isn’t markets – it’s that sometimes markets and the benefits they bring are playing second fiddle to the demands of one major corporation. The problem, in brief, is oppressive monopolies.
Big business is feeding into big government, right under our noses. We’re currently witnessing an interesting development in France concerning what has been dubbed “digital sovereignty”, with the government working hard to avoid becoming “a digital colony of the USA”. This involves French governmental departments switching away from Google as their default search engine, to Qwant – a French and German engine which sells itself on the fact it doesn’t track its users or hold any data on them.
This is in response to the US federal government’s intertwining of tech monopolies and the nasty habit of government meddling in the affairs of citizens. French politicians are railing against a proposed piece of American legislation which would allow the US to access data stocked on American companies’ clouds, no matter where they are located globally.
For all of its recent shortcomings, I’d applaud this small, but astute move from Macron’s government. By leading the way in railing against big tech and laying the groundwork for disruptors, not only will we be less likely to live in a world of US-controlled digital data, but we can encourage the big tech monopolies to “adapt or die”.
Because we’re currently at an awkward stage in which politicians, through fear of being seen as “anti-business”, are acquiescing to the demands of a few disproportionately influential business magnates.
By first ensuring a stricter cap on media ownership is adhered to, as previous DCMS secretaries of state have failed to do, and then incentivising greater plurality in the ownership of print media, we can inject competition back into a flagging field and encourage the press giants to adapt to the modern age.
The dawn of social media has revolutionised reporting and means politicos and news junkies can get the information they need by scrolling through Twitter. In order to improve a market which still serves millions of Britons, we need to legislate to ensure innovation, competition, and fairness – and drive disproportionate power out of the hands of an unelected few.
For most people, however, the print media and its downfall is a non-issue. Monopolies have meant that the print media has failed to adapt to new rivals, and it’s dying as a result. But who cares? Well, there’s clear evidence that encouraging disruption by ensuring markets are competitive – and not bowing to a powerful lobby – makes capitalism work better for the consumer, not crony corporations.
Take the private car industry. Sadiq Khan’s capitulation to the black cab lobby in London is a perfect example of politicians bowing to powerful vested interests – and not allowing free markets to work in the interests of the consumer.
Companies like Uber and Lyft have made the most of a market-place which is comparatively not ruined by politicians – and their services have made travel cheaper, safer and easier.
Unlike Sadiq Khan, neoliberals shouldn’t be afraid of calling out vested interests and monopolies just because it may feel as though we’re flying in the face of business. Instead, we should be encouraging politicians to stop being invertebrate, and stop capitulating to lobbies and big corporations when meddling in the market simply flies in the face of the consumer
Again, it isn’t the disruption to the old industries that people are rallying against, it’s the conspiracy between politicians and big business chiefs that mean people are failing to feel the effects of the free market raising their standard of living.
As Adam Smith said: “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” Chuck a couple of politicians in there as well, and it’s a pretty good point as to why so many are starting to feel that capitalism doesn’t work for them, and just serves the interests of the few.
Every day, we’re becoming more ethical consumers. People care about the environment, ethical labour, and social responsibility in a way that we didn’t in the past. Provided that we have enough transparency as to the inner workings of businesses, capitalism can be a progressive social good as well as an economic one.
Already, we’re seeing flourishing food and drink companies making waves through sustainably sourced goods that consumers are choosing over dodgier rivals – and the giants such as Tesco are being forced to keep up, taking steps to ditch plastic so as to retain the business of the more environmentally concerned consumers. Under real, free-market capitalism, the power is in our hands – we don’t need the government in order to make
