Saturday, 17 March 2018

Is a Magnitsky Act a Good Idea?

The 2012 US Magnitsky Act cited 18 Russian citizens who were held to be culpable for the death in custody of Sergei Magnitsky, a Russian accountant who had been investigating a tax fraud on behalf of the anglo-american financier Bill Browder. The Act prohibited entry to the US and use of its banking system by the named individuals, and also froze their existing US assets. Magnitsky (posthumously) and Browder (in absentia) were tried and convicted in 2013 of tax fraud by the Russian courts, though this was widely seen (even in Russia) as a tit-for-tat political response to the US measures rather than a disinterested criminal prosecution. In 2014, the EU imposed sanctions on an expanded list of 32 Russian citizens. In 2016, the US passed the Global Magnitsky Act, which gave the government general powers to impose visa bans and property sanctions in cases of "gross violations of internationally recognized human rights" or "acts of significant corruption". At the same time the number of Russian citizens subject to bans and seizures in the US was increased to 44.

In the UK, the 2017 Criminal Finances Act was initially touted as an equivalent to the Magnitsky Act, though its focus was on domestic criminal proceeds and the funding of international terrorism. An amendment to the act to freeze the UK assets of human rights violators was seen as weak and non-specific in comparison to the US original and similar laws enacted by Canada and the Baltic states. In the wake of the recent Salisbury incident and the apparent murder of a former Russian citizen in London, the Sanctions and Anti-Money Laundering Bill (which is currently going through Parliament) is expected to be amended to provide a sharper focus on Russia, however the Labour Party's desire for more wide-ranging powers to investigate and penalise foreign money flowing through the UK banking system is likely to be resisted. The track record of the British government is one of delay and dilution in respect of anything that might imperil the status of those Russian (or indeed any other nation's) oligarchs who have substantial assets in the UK.

This pusillanimity reflects not just the leverage that certain oligarchs have achieved through party donations and longstanding relations with politicians, but an institutional reluctance to question the source of wealth too closely, which long predates the dissolution of the Soviet Union and is really an extension of the circumspection applied to the native rich from the earliest days of industrial and imperial exploitation; a delicacy that was famously raised to the level of art by Jane Austen. The unspoken rule has always been that questions won't be asked so long as foreigners, including state actors, conduct themselves with discretion while on British soil, a hypocritical convention whose compensatory anxiety can be found in much late 19th and early 20th century literature, from Joseph Conrad's The Secret Agent to John Buchan's The Thirty-Nine Steps. In the late 20th century, this indulgence was variously justified (unconvincingly) as the unavoidable corollary of globalisation (being "open for business"), an existential necessity for the City of London, or simply as the chief prop of top-end property prices in the capital.

The hoo-ha over Corbyn's reluctance to find Putin personally guilty on the say-so of various retired MI5 officers has obviously been promoted to avoid criticism of the government's past tardiness in confronting Russia, notably in the case of the Litvinenko murder when Theresa May was Home Secretary. Likewise, the claim that the Labour leader's stance is driven by Seamus Milne's unreformed Stalinism, rather than an objectively justified scepticism about Britain's secret services, is clearly just the latest round in the attritional campaign still being run by the party's right wing. The national security laager will remain the last redoubt of opposition to Corbyn because it allows his party critics to plead the higher cause of patriotism to justify their disloyalty while Tories can guarantee favourable media coverage thanks to the muscle memory of the press. But to suggest in response to this nonsense that Labour's calls for a Magnitsky law mean that it is more robust than the Tories in the defence of British interests would be to fall into the trap of assuming that sanctions against named foreign nationals are actually a worthwhile policy.

State-level economic sanctions are generally ineffective, either because they tend to be relatively modest or because most states are resilient enough to either weather them or flexible enough to circumvent them. Given that the objective of sanctions is usually to satisfy domestic demand that "something be done", or to signal solidarity in international relations, most countries have tended towards the gestural in recent decades. Sanctions against named individuals are trivial, but their very personalisation means they make good copy for the press: we name the guilty men etc. As globalisation has integrated more economies we might have anticipated that state-level sanctions would have more bite, but paradoxically this process has led to their weakening, in no small part because they now inconvenience multinationals and global investors with clout. The disinvestment campaign against South Africa in the 1980s - arguably a tactical hangover from the days of capital controls - would be much more difficult to implement nowadays (the ineffective BDS campaign against Israel is illustrative). The move towards personalised sanctions, such as the Magnitsky Act, is therefore partly a structural shift, reflecting both the increased global mobility of personal wealth and the opaqueness of cross-border business financing.

A sanction is an act of discipline. It should therefore come as no surprise that ever since the Athenian measures against Megara ahead of the Peloponnesian War, sanctions have tended to be imperialistic, with larger powers seeking to coerce smaller powers within their perceived sphere of influence short of military intervention. The US sanctions against Cuba are perhaps the most famous example in recent history, and also stand as a testament to the pointlessness of the tactic: they may have damaged the Cuban economy but they actually reduced the potential for regime change by encouraging critics to emigrate. Even when the asymmetry is reversed, sanctions are still part of an imperial narrative. For example, the Magnitsky laws passed by Estonia, Latvia and Lithuania were clearly intended to broadcast the independence of the Baltic States from Russian influence (and thus reassure foreign investors). The shift to personal sanctions and the seizure of foreign assets has often been justified on the grounds of rooting out corruption, however this has also provided an opportunity for states to discipline their own financial institutions, which again reflects the pressures of globalisation. For example, the French moves against Teodorin Obiang, which did little to improve the lot of the people of Equatorial Guinea, were notable for the reprimands issued against French banks.

In many ways sanctions against named individuals are the flipside of actions taken to penalise foreigners who have the temerity to "interfere" in domestic affairs, such as the Russian actions against Bill Browder and foreign NGOs or Hungary's demonisation of George Soros. That such actions in Russia have been more substantial than those in Hungary reflects differences in the pliability of the legal system to fulfilling political objectives, and specifically that Hungary as an EU member is subject to the European Court of Justice. This highlights a problem with sanctions against individuals: the burden of proof is likely to be lower than it would be in a court of law (the difference between probability and proof beyond reasonable doubt was exemplified by the responses of Theresa May and Jeremy Corbyn respectively this week). For example, the US Magnitsky Act, which is essentially a judgement of guilt, was the product of political lobbying, not a trial by jury, and there is no possibility of appeal. That the number of Russians cited by the US grew over time from 18 to 44 might suggest a dogged pursuit of the facts, but it might also suggest an increasing generosity of interpretation.

A second problem is that the individuals are rarely "names". Tribunals judging state-sponsored crimes, such as the Nuremberg trials and the International Criminal Court, have tended to focus on the most egregious offenders and make notorious examples of them. In contrast, the sanctioning of named individuals has tended to cast the net as wide as possible. Just as the expulsion of spies masquerading as diplomats may catch a few innocent trade delegates to make up the numbers, so the effectiveness of sanctions becomes a question of volume. A third, related problem is that the distinction between private sector rent-seekers (who exploit the state) and corrupt apparatchiks (who exploit their position within the state) is often vague. The American-born Bill Browder, who became a UK citizen partly to avoid paying US taxes, may not have been guilty of the fraud for which he was convicted by Russia in 2013, but he did make money out of the privatisation of Russian state assets in the late 1990s. He may not personally have beeen corrupt, but he probably dealt with corrupt people. Drawing the line can be tricky.

A better approach would be to apply tougher laws on transparency and taxation universally, rather than trying to make a special case for individuals who abuse the apparatus of foreign states, but that would mean giving UK authorities the forensic powers to investigate and potentially penalise the financial affairs of its own citizens. The British government's insistence that its powers should be focused on criminal proceeds (and thus only evasion in the case of tax) or the financing of terrorism is a plea to leave the rich in obscurity. Ultimately, it is the protection of domestic wealth that has provided the cover for Russian oligarchs and others to shelter their gains (whether ill-gotten or not) in the City of London. With the death of Boris Berezovsky after his failure to successfully sue Roman Abramovich, and the tortuously slow progress in the Litvinenko murder case, it looks like the Russian state considers the UK to be an essentially friendly territory. Given the gestural nature of the British government's response to the attacks on the Skripals, and its alacrity in shifting the domestic debate away from money power towards patriotism, they are probably justified in thinking this.

Wednesday, 14 March 2018

Neoliberal Corbynism

Recent opinion polls have put Labour and the Conservatives roughly neck and neck in the low-40s. With the LibDems lacking sympathetic media coverage, not least because so much of the available space is taken up with centrist criticisms of Labour, and UKIP suffering as it implodes in comical fashion, it is hard to envisage the political scene shifting away from this familiar duality any time soon. With the exception of Scotland's three-way split, we are back to the two-party model of British politics that characterised the quarter century between 1945 and 1970. In terms of rhetoric, however, we are back to the early 1980s, with the Labour leader cast as politically illegitimate: at best a naif, at worst a traitor. Of course, the persistent under-estimation of Corbyn suggests that the naivety is more likely to be found among his critics. For example, his response to the likely involvement of Russia in the Skripal case - a demand for practical action on oligarch money in British politics - will probably turn out to be a shrewd move once the hyperventilating ceases and the UK government's proposed sanctions turn out to be underwhelming, particularly if the Tories continue to drag their feet on the issue of donations.

While there are substantial differences between the parties in areas such as public ownership and housing, and there may even prove to be a clean dividing line in respect of Brexit, the gap between the two is not that large when viewed historically. Though many people recall the "longest suicide note in history" crack about Labour's 1983 manifesto, it is worth remembering that the Tory programme at the time was no less radical in its commitment to root-and-branch "reform" of society and the economy. It was the gap between the two that provided the imagined space for the launch of the Social Democratic Party, though the SDP-Liberal Alliance manifesto of 1983 was in reality a pick-and-mix from the other two rather than a distinctive third way: that would have to wait on the social reordering accomplished by Thatcher in the 80s and the advances of financialisation and globalisation in the 90s, whose political manifestation would be New Labour. The relative narrowness of the political choice today, despite Labour's clear (and ongoing) shift to the left, shows the extent to which the neoliberal norms established in the 80s and 90s still dominate.

The common understanding of neoliberalism centres on the intensification of pre-existing practices and modes of thought, such as free markets and laissez-faire, hence it is often described as simply "late capitalism". The more sophisticated view is that neoliberalism is essentially biopolitical. In this reading the ideological core of neoliberalism is the translation of labour from a class both in and for itself (as described by Karl Marx) to a field of atomised individuals, each pursuing their own utility preferences. Workers are no longer the objects of collective state discipline in the service of capital but notionally autonomous subjects actively involved in self-discipline. There are some obvious paradoxes here - what Michel Foucault described as crises of govermentality - such as that "freedom" necessitates state coercion (e.g. anti-union laws); that individualism is achieved through the pursuit of common goals and metrics, such as property-ownership and financial wealth; and that political expression becomes increasingly narrow (i.e anti-plural) through ideological constraints such as TINA ("there is no alternative") and technocracy. But a less obvious paradox is that while this erodes faith in politics, when a clear alternative is presented, as was the case with the EU referendum, traditional party affiliations are found to be a weaker defence against radicalism.

What the biopolitical view tends to neglect is the transformative impact of neoliberalism on the institutions of the state. Over and above the re-engineering of those institutions to achieve particular social and economic goals, the fabric and culture of government itself is effected through feedback from an established neoliberal society. In other words, a focus on governmentality can obscure the historical evolution of government. To take an example from the para-state, the excessive pay awarded to university vice-chancellors is not merely the result of a conscious programme of marketisation in the higher education sector, it also reflects the common expectations of CEOs across the economy in respect of their relative remuneration - i.e. it should be a high multiple of average employee salaries and generous pension contributions are matters of executive esteem as much as simple avarice. The same processes are at work within the apparatus of central government, both as a result of the "revolving door" with the business world and the programmatic adoption of business practices and modern managerialism within institutions such as the Civil Service.

While there have been compositional shifts in the state due to secular changes since 1945, such as the declining demands of defence and the increase in elderly welfare, the only substantive retreat by government attributable to policy has been in the area of house-building. Privatisation did little to change the nature of the state because most nationalised industries were operated at arms-length: the man from the ministry was a nominal presence hence there was little feedback that affected the ministry itself. What has changed is the commercialisation of both public service delivery and government administration. Despite high-profile failures such as Carillion, the story of government contracting-out has been less one of incompetence than poor value for money. In contrast, the adoption of commercial practices within the state apparatus has reduced its ability to respond to challenges that fall outside the implicit neoliberal "contract". The obvious example of this is Brexit, which has not only monopolised government bandwidth but has highlighted the lack of key expertise within the apparatus. This is not just a matter of the skills that were made redundant by membership of the EU, such as trade agreement negotiation, but of fundamental capabilities such as agility and foresight.

We are faced with an interesting conjuncture: the Labour Party is likely to offer a programme at the next general election that will significantly diverge from neoliberal orthodoxy in certain areas, while the capability of the state apparatus to deliver this programme will be severely constrained. That might sound like a recipe for inhibition and disappointment, but paradoxically it could prove to be the reverse. Just as the apparatus of the state will struggle to operate outside the orthodox neoliberal paradigm, so it will struggle to baffle and constrain a reforming government that ignores the orthodoxy, not least because the bypassing of state institutions by political management has been normalised over recent decades by special advisors, public-private partnerships and the bullying of civil servants (the tonal difference between Yes, Minister and The Thick of It is illustrative: from creative tension to zero-sum coercion). The modern administration is far more vulnerable to political control than was the case when Tony Benn was lamenting the obstruction of civil servants in his diary.

Among organised labour, the cultural changes stimulated by neoliberalism had the greatest impact on skilled workers, which led to a disproportionate decline in the membership and influence of those unions that had traditionally been on the right of the Labour Party. This was exacerbated by structural changes in the economy, such as the continued relative decline of manufacturing, the increase in self-employment and the growth of non-unionised service sectors, all of which disproportionately affected "moderate" unions. Meanwhile, neoliberal initiatives to marketise traditionally non-militant sectors, such as higher education, and the antagonistic attitude towards unions identified with the welfare state, such as in local government and health, have helped to advance more leftwing union leaders and broaden the focus from pay and conditions to structural questions of ownership and social responsibility, many of which hark back to the radical tradition of the 1970s (workers control, UBI etc). The current manoeuvring within the Labour Party between Momentum and the unions is being presented by centrists as evidence of factionalism, but the underlying story is actually one of an increasingly leftist bent that is being driven by both unions and constituency members. Their differences are more tactical than strategic.

The disenchantment of politics by the market was not simply a case of shifting the boundary between the two, with areas of life once under political control now exposed to market forces, but also encompassed the marketisation of political practice itself. Politics was relegated from the ethical oversight of progress to a series of techniques for addressing collective action problems that cannot (yet) be resolved by either competition or technology. A consequence of this was an increased meeting of minds between the state apparatus and the political class, evidenced in the increasingly technocratic approach of the one and the professionalisation of the other. One corollary of this was a decline in cognitive diversity and thus institutional resilience within the apparatus, but another was the increased confidence of politicians in their managerial ability to direct the machinery of state. The prospects for a reforming Labour government (assuming it can get elected) have paradoxically been boosted by three neoliberal developments: the weakening of the civil service as a normatively conservative institution; the advance in public sector trade unions of a left committed to structural change; and an acceptance among even centrist MPs that the state can be transformative.

Friday, 9 March 2018

At Which Point I Emerged Blinking Into the Daylight

The Shape of Water was a worthy winner of the best picture Oscar on Sunday. It was not only deeply engaging and frequently surprising, but it had an attention to both detail and rhythm that fully justified its separate awards for direction, production design and original score, as well as excellent and subversively humorous acting. Sally Hawkins and Oliva Spencer have something of Laurel and Hardy about them, which I most definitely mean as a compliment. As the title makes clear, water is the symbolic heart of the film, but it's a symbol with multiple meanings, from sexual longing and freedom to pollution and destruction. This film is set in the early-1960s, an era that is usually imagined as sunny, if troubled by the possibility of nuclear apocalypse, but here is darkly green-hued and seems on the verge of being drowned rather than burnt to a crisp: the rain on a bus window, a flooded bathroom that leaks into a cinema auditorium, a rising tide that penetrates the city. Though many critics have characterised it as a magical realist homage to classic Hollywood films (itself a cliché in the analysis of Hispanic directors), I think it was inspired more by a mix of European surrealism and American comics, which should hardly come as a surprise given Guillermo del Toro's previous work, from Pan's Labyrinth to Pacific Rim.

If the sombre comic-book feel heightens the sense of heroic tragedy, the everyday surrealism undercuts it with both pathos and bathos (a lurid Key lime pie represents thwarted desire while the ubiquitous pail and mop represents the supporting role of women, forced to clean up the men's various messes). The tension between the tragic and the surreal is particularly evident in the supporting male characters, played by Michael Shannon, Richard Jenkins and Michael Stuhlbarg, who each present a compressed and conflicted man as much at odds with the world as the aquatic "Asset". The Amphibian Man is the apotheosis of this type, being both a fish out of water and "some kind of god". In many ways it is a film about the difficulty men have in establishing meaningful relationships, not just with women but with each other. Language is problematic, rituals have become empty forms and violence is always in the air. In contrast, the women communicate so well that they are repeatedly silenced by male authority. Playing a mute, and therefore a woman who is both ideal and subversive, Hawkins must act through her facial expressions and gestures, which called to mind the subtlety of Setsuko Hara in the films of Yasujiro Ozu.

Three Billboards Outside Ebbing, Missouri deservedly won two acting Oscars and I suspect it was a close finish between it and Get Out for the best original screenplay. Martin McDonagh's script has a classical foundation, though it deliberately eschews resolution, centring on the vengeful Hecuba that is Frances McDormand's character (still visible beneath the John Wayne mannerisms) and Woody Harrelson's epistolary, Stoic police chief. Jordan Peele's Get Out similarly avoids predictability and defies genre categorisation as it subverts tropes from American Gothic, police procedurals and modern horror. The denouement, where the black hero doesn't get shot (in the manner of Night of the Living Dead), being a case in point. Critics have compared it to The Stepford Wives and Rosemary's Baby, but I think it would be just as relevant to cite H G Wells's The Island of Doctor Moreau and The Time Machine. The "experiments" are all flawed and unstable, while Daniel Kaluuya's protagonist finds himself travelling through time in a chair and appalled by the reality hidden below ground. Like Richard Mathieson's I Am Legend, Get Out exists fruitfully on the border between horror and science fiction.

Three Billboards has been criticised for allowing a racist character, Sam Rockwell's cop, the opportunity of reform and redemption, while Get Out was given a free pass for essentially endorsing segregation (albeit in self-defence). It would appear that Malcolm X has finally triumphed over Martin Luther King Jr. in the liberal imagination. Many critics have interpreted the latter film as an attack on liberal hypocrisy, but this ignores that the Armitage family are defined less by their progressive cant than by their extensive property holdings. It also suggests that the problem with lying psychopaths is their dishonesty. In fact, the satire in the film largely revolves around black paranoia, a topic most critics scrupulously avoided. In some respects, Three Billboards is the greater satire on liberal pieties precisely because it doesn't resolve that revenge is bad and reform is good. The racist cop is not redeemed and the bereft (and guilt-ridden) mother is not avenged. The lesson to take from both films is that satire is apolitical. In contrast, the least satirical film of the year was Blade Runner: 2049, which made it one of the best political films (this is probably a minority view). The best film about politics - not the same thing - was The Death of Stalin: a cross between Shakespeare and a version of Fawlty Towers in which Sybil dies (I imagine it was this that got it banned in Russia).

The hot Oscars contender that came away empty-handed was Lady Bird, though I can't say that I was surprised. If Three Billboards is dramatically plausible but sociologically improbable, Lady Bird is sociologically convincing but to the point of predictability, which neutralises its limited dramatic tension. This doesn't matter so much because of the comedy and the deft direction, and the knowing enjoyment of the coming-of-age stereotypes (suburban boredom, teenage anxiety, appreciating your family etc), but it leaves the film feeling insubstantial: a pleasant collection of linked short stories whose sense of progress is purely chronological. Despite Saoirse Ronan's strong central performance, some of the film's better moments come when it focuses on the parents, played by Laurie Metcalf and Tracy Letts, simply because they are more than stereotypes and have dramatic depth. It makes for an interesting contrast with 20th Century Women, which tackled many of the same themes and featured Greta Gerwig in front of the camera, but which had an individualism just the right side of quirky. That under-appreciated 2016 release just missed out on the #MeToo wave and the assertion of the female interest crystallised in McDormand's "inclusion rider", which perhaps propelled Lady Bird to unrealistic levels of expectation. Gerwig will get further opportunities - she is obviously a talented director - but needs to move on from the autobiographical.

One film that missed the 2017 Oscars cut was Black Panther, though I doubt it will have the staying power to bother the 2018 judges. It has understandably enjoyed a lot of goodwill, and is certainly fun, not least in Andy Serkis's over-the-top villain, but it was a pretty conventional addition to the Marvel canon. The idea that Wakanda should have remained a tribal society subject to animism and absolute monarchy despite its urbanism and technological progress is not only absurd but verging on the culturally essentialist. These antique forms do however make it easier for the film to successfully integrate a series of familiar tropes from James Bond, Rider Haggard's She and Lord of the Rings. Tellingly, the villainous Erik Killmonger, played by Michael B Jordan, is a more interesting character than T'Challa, played by Chadwick Boseman, while Letitia Wight's Shuri steals most of the scenes she is in. This is because they are the most recognisably modern characters. While The Shape of Water manages to address contemporary pathologies through a fantasy set in the past, Black Panther seems too respectful of heritage and uncomfortable in the present. That it ends with talk of "outreach" suggests that Marvel is now wholly under the sway of corporate lawyers.

Monday, 5 March 2018

It Can't Happen Here

The American economist Tyler Cowen believes that the US is safe from a Fascist takeover of the sort imagined in Sinclair Lewis's 1935 novel, It Can't Happen Here: "My argument is pretty simple: American fascism cannot happen anymore because the American government is so large and unwieldy. It is simply too hard for the fascists, or for that matter other radical groups, to seize control of." But Cowen's praise for big government is qualified: "In many Western societies, it is very difficult to get rid of excess bureaucracy and regulation, to the detriment of dynamism and economic growth. Just as we are insulated from a fascist takeover, so are we probably stuck with some of the less efficient features of modern social democracies". The implication is that secular stagnation may be a product of government inertia as much as technological change but that this at least delivers political stability. There is something to be said for this idea. The current populist wave has been exaggerated as a threat to democracy and authoritarian policies have been advanced mainly by established conservatives along well-worn paths. In the US, the Trump moment has revealed itself to be a continuation of modern Republicanism with an added layer of dynastic corruption.

But there are two problems with Cowen's theory. First, it misrepresents the relationship of historic fascism with the state, presenting the former as a dynamic aggressor and the latter as a passive victim. Second, it assumes a continuity in the subjects and modes of state regulation across a century, partly to support the charge of inertia and partly to support the claim that the modern state remains essentially social democratic rather than neoliberal. As a result, Cowen's argument relies heavily on a particular misreading of history: "Surely it ought to give us pause that the major instances of Western fascism came right after a time when government was relatively small, and not too long after the heyday of classical liberalism in Europe, namely the late 19th century". In fact, the heyday of classical liberalism was the middle of the nineteenth century. After 1870, rapid industrialisation, imperialism and the exigencies of World War One combined to rapidly grow the state. If there was a Fascist window of opportunity, according to Cowen's theory, it would have been closer to 1848 than 1922 or 1933.

In lauding the resilience of big government, Cowen can use a critique of libertarian demands for a small state to make a sociological claim about fascists: "Yet the greater focus of the night watchman state, for all its virtues, is part of the reason why it is easy to take over. There is a clearly defined center of power and a clearly defined set of lines of authority; furthermore, the main activity of the state is to enforce property rights through violence or the threat of violence. ... The culture and ethos of such a state is likely to be relatively masculine and also relatively martial and tolerant of a certain amount of risk, and indeed violence." That fascist parties in the 1920s attracted violent misogynists is hardly news, but it is a fallacy of composition to assume that all fascists were young, male and brutal. Much of the electoral backing for fascist parties came from the "respectable" bourgeoisie and older voters, while the history of fascist parties in government was marked by the gradual marginalisation of the street-fighters (most famously the SA in Germany) and opportunistic alliances with established conservative elites in the military, foreign and civil service.

Cowen's fundamental premise is that fascism is exogenous and therefore a larger government will be more resilient: "The history of fascism more generally has been characterized by conflict between party and state, and extreme fascist victories typically have required the ascendancy of party and thus a relatively weak state". This is to ignore the extent to which historic fascism was an endogenous faction (and reaction) within the state apparatus, rather than a populist insurgency by a hitherto excluded and powerless social stratum. Cowen's theory requires us to believe that fascism got in "under the wire" before the expansion of the modern state created a structural bulwark against its advance, but a different reading is that fascism was actually a product of the growth of the state in the 50-year period between 1870 and 1920. Indeed, one could go further and suggest that fascism was an attempt by political nationalism to catch-up with and master the rapid development of the state in that period (e.g. the Nazis' Gleichschaltung). It was reactionary, but it also sought to supersede modernity and thus adopted a revolutionary mode.

It is no coincidence that Fascism and Nazism would arise in those larger Western European countries, Italy and Germany, that saw the creation of a new state apparatus as part of political unification in the nineteenth century. That coming together obviously had many ramifications, from cultural homogenisation to a psychological anxiety about dissolution, but the bureaucratic effect was the association of the state with the "national idea". More established nations, like the UK or France, had a conservative apparatus, but one that was committed to the preservation of the status quo rather than the achievement of any programmatic goal. In contrast, the state apparatus of Germany and Italy was both progressive, in its commitment to a new order, and reactionary, in its distaste for democracy and its fear of socialism. This was evident in the enthusiasm of the apparatchiks. For example, the Nazis enjoyed considerable support among civil servants in the 1920s and 30s (which they repaid with employment bans on first Jews and then married women once they came to power).

In Germany, not only did the Nazi Party not capture the state wholly from without, but defeat in the Second World War and formal de-Nazification did little to change the personnel, not least because the Allied Powers decided that the construction of the new Federal Republic in the face of the Communist challenge required a pragmatic forgetfulness (compare and contrast with the attitude towards the Ba'ath Party in Iraq after 2003). While many individuals claimed that they had only joined the Nazi Party to advance their careers, the high proportion of ex-party members (or "Altnazis") in the civil service, judiciary and university administration - many still espousing far-right and authoritarian views - was a running sore that would become a prime focus for the German student movement in the 1960s. This history is inconvenient for Cowen's theory because it shows both the extent to which the fascist state was already incipient within the apparatus of the Weimar Republic and how fascist elements can still be accommodated within a social democratic state.

In seeking to cast the war as a dividing line between the vulnerable and the resilient state, Cowen notes that German government spending was 36.6% of GDP in 1932, which was "considerably smaller than what the German government would grow to after the de-Nazification following World War II, when government rose to 44 percent of GDP by 1958 and to much more later". This isn't a compelling argument. After all, current US government spending is only 36% of GDP, but Cowen's premise is that this represents a large state that is now invulnerable to fascist takeover. Using government spending as a share of GDP as a proxy for the size of the state is also problematic because of differences in the way that social goods such as healthcare and education are accounted for between the private and public sectors. National accounting data tell us little about the institutional resilience of the state apparatus, which is surely more important when considering its vulnerability to an authoritarian coup d'etat. It also tells us little about the changing composition of government activity: what subjects the money is spent on and what modes are employed in managing that expenditure.

State regulation in the hundred years between 1850 and 1950 was concerned more with people than commodities, reflecting both the initial purpose of the modern state (to manage labour for capital) and limited environmental consciousness. The social democratic era saw a gradual decline in the focus on labour (culminating in labour market deregulation) and an increase in the focus on land, raw materials, and commodities. This was a result not just of material changes, such as the oil crises of the 70s and growing evidence of environmental damage, but of social demand. This demand was exemplified in the early-80s by the growth of the Green movement, protests against nuclear power and weapons proliferation, and consumer boycotts (e.g. against South African fruit). By the 1990s, neoliberalism had fully shifted the focus of the state towards commodities (the EU and WTO rounds to the fore), with the disciplining of labour now largely internalised. The last twenty years have seen a limited revival of more traditional biopolitical forms to deal with the "recalcitrant minority" of labour (workfare etc), as well as a growing social demand for greater control over the movement of people internationally. It is this recent oscillation that has marginally improved the prospects for fascism.

Cowen's claim is that Big Government remains social democratic and that its consequent flaws are unintentionally anti-fascist: "Just as we are insulated from a fascist takeover, so are we probably stuck with some of the less efficient features of modern social democracies. ... We can therefore think of the ongoing evolution and cementing of Big Government, in the social welfare and bureaucratic senses of that term, is an extended exercise in risk aversion" (Cowen's yearning for the US to take more risks - a central theme of his works like The Great Stagnation - here comes close to a flirtation with the fascist aesthetic). The reason why a fascist takeover in the US is unlikely has little to do with the size of government, or the preponderance of paper-shuffling civil servants over heavily-armed border guards, and everything to do with the political configuration. Fascism depends on the opportunistic support of conservative factions and big capital, which in turn assumes a leftwing that is perceived to pose an existential threat. Today, the Republican Party is too well-entrenched within the apparatus (particularly at state - i.e. sub-federal - level), the Democratic Party too compromised by capital, and the American left too weak.

Wednesday, 28 February 2018

Toby Young and the Modern Establishment

The idea of the establishment arguably has a more concrete reality than the establishment itself. This is not just because the latter is fuzzy around the edges, but because the former is such a useful line of attack that no one bats an eyelid when an Oxbridge-educated newspaper columnist berates the "liberal establishment" for undermining Brexit. This might lead you to think that the establishment has fundamentally changed over the last half-century, or perhaps that it has fragmented into multiple establishments. Certainly many of the recent studies on the subject have tended towards one or the other view, either documenting a comprehensive neoliberal takeover of conservative institutions since the 1980s or a fragmentation under pressure from globalisation into a set of competing, often supranational elites. In that light, the official report into the aborted appointment of Toby Young to the Office for Students is almost reassuringly old-fashioned in the picture it paints. It is a Hogarthian scene that combines the promotion through political patronage of the unqualified but well-connected with the blackballing of the qualified but politically unsound.

The origin of the term is usually attributed to the British journalist Henry Fairlie, writing in 1955: "By the Establishment, I do not only mean the centres of official power—though they are certainly part of it—but rather the whole matrix of official and social relations within which power is exercised. The exercise of power in the United Kingdom (more specifically, in England) cannot be understood unless it is recognized that it is exercised socially". The seminal work on the subject was Anthony Sampson's 1962 Anatomy of Britain, the popular success of which ensured that the topic would be dominated by the "wot I fink" school of long-form journalism rather than by academic sociology, hence recent years have seen chunky books from the likes of Andrew Adonis & Steven Pollard, Jeremy Paxman and Owen Jones. Aeron Davis is the latest addition to the pile, though as a professor of political communications at Goldsmith's College you'd hope for something beyond either nostalgia or polemic. The summary of his thinking that appeared in The Guardian this week doesn't bode well.

While it's unlikely that Fairlie's idea of a matrix of social relations was inspired by Antonio Gramsci's theory of hegemony, which had come to prominence in Italy with the first publication of his Prison Notebooks in 1947, both were symptomatic of a postwar interest in society as a dynamic system in which progressive and conservative elements struggled culturally as much as socially (the war of position, in Gramsci's terminology). This was in contrast to the more straightforward and violent conflict of the prewar years centred on class and national identity (the war of manoeuvre). The context for this shift was the geopolitical stability of the Cold War in Europe and the broad acceptance on the left (most notably by Italy's Communist Party) of a parliamentary road to socialism. Understanding the component parts of society beyond simple class structures became a political necessity. In the UK, the eager misunderstanding of Michael Young's satirical "meritocracy" (and in particular the way that welfare state sinecures were monopolised by the old establishment), together with the uncertainty of Britain's post-Suez trajectory, raised the question of whether the country's governance was any longer fit for purpose.

Davis's approach appears to be firmly in the tradition of Sampson, with a reliance on individual interviews and thus a bias towards the anecdotal. I've not read the book, so the summary may be obscuring a solid foundation of empirical research in order to sex-up the narrative, but the fact that interviews are relied on is not encouraging. While the technique can make sense in a sociological study, where the subjects are usually accessible and other evidence scant, the establishment is surely more suited to a historical approach, given the ample documentary evidence of its doings and the likely inaccessibility of some of its contemporary figures (and that the more accessible ones will be skilled self-promoters). Being able to check facts and interpretations face-to-face is merely a bonus. Davis reports that over 20 years he has interviewed "more than 350 people working in or close to the top". This is not just leisurely in its pace, calling into question how accurate a picture can be formed given the degree of change over two decades, but is vague about the selection criteria. The Molesworth-like "top" and the impression of a series of informal "chats" is close to a parody of establishment values and practice.

The problem at the heart of the study of the British establishment is the model established by Sampson: "In my first Anatomy in 1962 I tried to depict Britain's Establishment as a set of intersecting circles of varying size - each representing a different institution - loosely linked to each other round an empty space in the middle. It was in the nature of Britain's democracy that there was no single dominating centre, and much of the power depended on fixers and go-betweens to connect one circle with another". This Whiggish ideal of collaborating interests placed too much influence on the institutional basis of the separate circles, hence the Church of England could still be considered part of the establishment in the 1960s despite its marginalisation in the postwar years by the welfare state. It also suggested a balance of powers that was negotiated through informal transactions, which fed the popular appetite for occult networks and deep-state conspiracies: that "they" were working against "us". The reality was more mundane: groupthink and mutual back-scratching. The omission in the model - that empty space in the middle - was the hegemon that guaranteed the balance of powers.

The journalistic imagination doesn't have much interest in the structural relationships of institutions (e.g. how the NHS affected organised religion), or the way that institutions evolve (e.g. the professionalisation of politics). It sees institutions as fixed features and individuals as opportunists who seek to exploit them through unmerited occupancy or abuse of power, a prejudice that has been reinforced by Public Choice Theory. To give a current example, foreign aid charities like Oxfam are facing secular decline for a number of economic and geopolitical reasons, but this is being obscured by lurid tales of individual wrong-doing. There is a hint of this (and of the fragmentation theory) in the title of Davis's book, Reckless Opportunists: Elites at the End of the Establishment. The cause of this decline is held to be the triumph of neoliberal self-interest, which has led elites to disown responsibility for any wider coordination and thus the maintenance of the establishment as a normative field. In other words, Davis considers the establishment to have been historically specific to the social democratic era, which echoes Fairlie's conservative spin on a Polanyian double movement: "Men of power need to be checked by a collective opinion which is stable and which they cannot override: public opinion needs its counter; new opinion must be tested. These the Establishment provides: the check, the counter and the test".

Davis sees two key manifestations of the waning of the establishment: "a shift in elite power from the public sector to the private sector" and the breaking of "the automatic links between exclusive education, tradition, status, power and money". Both are questionable. The first is an example of swallowing the Thatcherite myth of a reduced state and a flowering of entrepreneurialism at the expense of anti-commercial institutions. Measured as a share of GDP, the state has not shrunk: large swathes of public goods and services have instead been handed over to private businesses that now rely on tax revenues and thus political influence. Carillion is an obvious recent example. Likewise, the marketisation of institutions has not reduced their social influence. University vice-chancellors may be more venal, but they are no less powerful. As to the conveyor-belt of privilege, Davis cites in evidence CEOs, despite these being unrepresentative of the wider establishment due to greater internationalisation in recent decades and the preponderance of the self-made: "Only a third of those I interviewed – 20 CEOS of FTSE 100 companies, and 10 CEOs from the top 100 private companies – came from a wealthy, upper-class background or had attended a public school". To understand the establishment you would do better to look at the educational background of CFOs and corporate lawyers.

It would also be worth asking how many of those 30 CEOs were paying for their own children to be privately educated. I suspect more than a third. One of the chief roles played by public schools is the laundering of nouveau riche and foreign offspring. While fans talk up public schools as astute operators in a global marketplace, we shouldn't lose sight of the fact that they remain dependent on the native rich who still expect social preferment as well as a polished education for their money. As an illustration of changing times, Davis tells of the culture clash between the plebeian Gerry Robinson and Sir Rocco Forte in the 1995 Granada Group takeover of Trusthouse Forte, forgetting that while the latter may have been a Tory donor who liked shooting grouse, he was also the son of an initially poor Italian immigrant to Scotland. The focus on CEOs is indicative of the increased identification of the establishment in the era of globalisation with the City of London and the stateless corporate class embodied by "Davos man", but this tendency confuses the commercial elite, which of necessity has always been global, with the state elite, which of necessity has always been national. While the two intersect, their interests and modalities are distinct. The danger with this focus on business is that the actual establishment, which is always centred on political and state apparatus elites, moves out of focus.

Davis suggests that the growing power of the money-men has "left the various parts of the current establishment more disparate and more antagonistic towards each other", citing Margaret Beckett on her experience of a meeting in the early-90s: "it was almost like the bride’s side and groom’s side – the people from the financial world, and the people from the industrial world, and they almost weren’t talking to each other". As any history of British industry or the City would reveal, this antipathy and mutual mistrust dates back to the middle of the nineteenth century at least. There is little new here. More significantly, this anecdote occludes the other key interest in the room: the political establishment represented by Beckett herself. The supposedly empty space at the centre of Sampson's model has always been occupied by politics. The changing cast of characters doesn't make it any less of a consistent interest. The surrounding circles were, in Sampson's benign interpretation from 2004 "a network of liberal-minded people who could counteract the excesses of autocratic and short-sighted governments". The timing of those words is obviously telling, but it also highlights the weakness of the peripheral establishment, much of which was complicit in the Iraq misadventure. The core political interest remains the hegemon, all too easily able to overcome Fairlie's checks and counters.

My own view (wot I fink) is that the wider establishment was never as substantial or coherent as Sampson and his imitators thought, being more protean in its membership and having a much more uneven distribution of effective influence. That said, I also doubt that the establishment has changed as much as more recent writers like Jones and Davis imagine. A focus on "banksters" risks being ahistorical (fraud and greed are not new), while a focus on ruthless CEOs risks casting the net so wide as to simply equate the establishment with capitalism, collapsing superstructure and base. Neoliberalism has certainly had a dramatic effect, but that is to be seen mainly in the changing attitudes of the hegemon at the centre of what is better described as a set of concentric circles that reflect access to public money rather than inter-personal networks. Politicians at the core, then the state apparatus, then the para-state of contractors and mediators, then the wider circle of business. Some of those circles have expanded or contracted over time, but the core remains constant. Institutions do not always map to a single circle in this schematic and can move between them. The City of London, for example, owes its power to cutting across all four, while higher education is transitioning from the para-state to business.

Much of the rhetorical use of the establishment as a term concerns competition and readjustment between these circles, thus "the liberal establishment" reflects the relative triumph of the para-state over the state apparatus since the 80s, while the increased used of "the political establishment" reflects not only the perceived congruence of interests of the major parties (at least up until 2015) but also the expansion of political appointments to policy areas previously controlled by the Civil Service (the OfS is a case in point). Insofar as we can talk of a decline in the "old" establishment, it is to be found not in the reduced circumstances of the Royal Navy or the Church of England but in the weakened influence of Whitehall as an institution, a development that started well before the appearance of Yes, Minister on our TV screens. Ironically, this was as much down to pull as push, as much of the government machine's senior talent was willingly siphoned off to Brussels. Brexit is unlikely to reverse this decline: the Tories will continue to favour the para-state (they'll outsource the Irish border to Serco) while Labour will probably expand the political core (having read the warnings in Tony Benn's diaries).

Looked at in the round, the establishment is essentially those individuals and groups that enjoy political influence (derived from their economic position) beyond any democratic justification. It currently includes newspaper proprietors and the military, but not trade union leaders or the National Trust. Because it relies on personal networks and loyalties, influence is "sticky", so it tends to dissipate at a slower rate than economic power. This explains why early studies of the establishment, which caught social formations under pressure from the social democratic dispensation, gave too much weight to tradition and the old school tie. There is some evidence that co-option and rejection by the establishment now happens more quickly than in the past, but this probably just reflects the greater social dynamism of late capitalism (or the postmodern condition, if you prefer). In that respect, Toby Young is again an object lesson: a man who has been repeatedly expelled but whose success in gaining readmittance reflects less on his charm than on the growth of the circle of the para-state and its insatiable demand for useful idiots.