Davy Jones Consultancy

The collapse of capitalism

Now I've seen it all - a Labour government nationalises half the banks and the stock market cheers. Almost twenty years after the collapse of communism, capitalism has now gone the same way. Good riddance to both of them !

Throughout those twenty years, markets have held sway - omnipotent, infallible, unchallengeable. They could and did exactly what they wanted, regardless of public need or the views of ordinary citizens. Now all can see how greedy, secretive, incompetent, wasteful and irresponsible they have been.

The public will not forgive them for many years. People will demand transparency, regulation, responsibility, restraint and the public interest being reasserted. If the banks can be nationalised, why not rail services, or energy utilities whose reckless profiteering and incompetence has almost matched that of the banks?

What about the rights of ordinary citizens ?

But no one wants the old-style "nationalisation". People will demand a direct say, not just a seat on the Board for the Government, in how these institutions and services are run. Citizen involvement and empowerment should extend to these organisations whose activities are so important to the daily lives of everyone. As Jonathan Freedland said in the Guardian last week, "this is a crisis of democracy" - a clash between democracy and the untrammelled power of the markets.

Elephant in the room

But wait, this crisis affects local services too. And not just because of the irresponsibility of councils investing in dodgy overseas banks. There has long been an "elephant in the room" in discussions on citizen involvement - privatisation. It rarely gets a mention. But the fact is that privatisation has been busily working away to undermine the empowerment agenda for years.

How can citizens and service users take decisions where contracts have been awarded to private companies, whose primary responsibility is not to local people but to shareholders (and let's be clear, overwhelmingly these will be big institutional investors including those lovely bankers) ? It is most stark in PFI deals, where frequently it is financially crippling to attempt to amend the terms of the contract even where demographics have changed, service users have developed new needs and requirements or where citizens views on the service priorities have changed.

The Government should legislate that ALL those providing local public services (including the private and voluntary sectors) should have a duty to promote the social, economic and environmental well-being of their communities. This would clearly put the interests of local people/citizens/services users first, not those of the markets and shareholders.

Empowerment agenda shifts

As the empowerment agenda shifts inevitably to how it can be more efficient and save money, and act as a tool to help citizens make "tough choices", let's not forget to tackle the pernicious influence of the markets in local services too. In any conflict between the interests of the market and local people, it is the latter whose interests should be paramount.