Monday, December 01, 2008

Germany's Left Turn (and how democratic is Angela Merkel?)

This column of mine on the strong support for nationalisation in Germany and other issues involving public ownership, appears in today's Morning Star.

Germany's Left Turn

Germany is certainly a very interesting place to be at present. The unequivocally and unapologetically socialist Die Linke (The Left) party goes from strength to strength- gaining more new members than any other German political grouping. Sales of books by Karl Marx are up by 300%. And a new opinion poll shows that the overwhelming majority of Germans would not only like to see an end to any further privatisation- but the nationalisation of large segments of the economy.

In the survey, carried out by Forsa research group, 77% of Germans said that the state should take large equity stakes in German energy companies, while 64% said that financial institutions should be at least partly nationalised. Furthermore 60% of Germans said that the airline Lufthansa, Deutsche Post and the railway Deutsche Bahn should either come into, or stay under state ownership. And up to 45% of Germans thought nationalisation or partial nationalisation should extend to the telecommunications, chemicals, pharmaceuticals and farming sectors.

The poll shows the depth of opposition to neoliberalism in Europe’s largest economy, but encouraging as it is, important battles still lie ahead. The Financial Times reports that “regardless of the changing sentiment, Berlin continues to work on divesting its residual stakes in the former post and telecom monopolies and is planning to float Deutsche Bahn next year”.

The next few months will tell us just how committed to democracy the German government of Angela Merkel really is. Will it listen to the German people and halt privatisation- and embark on a programme of re-nationalisation? Or will it treat the views of the people with contempt and carry on privatising?


As public support for nationalisation grows by the day, so the attacks on it in the media by Thatcherite ideologues intensify.

One such piece appeared recently in The Times. Lambasting British Rail, the writer opined: “Now that bankers and hedge fund managers are in the dock, it is easy to forget how nationalised industries ruined the economy. But with Gordon Brown out to convince the world that we need another state-led Keynesian spending splurge, we would do well to recall what happened last time the State took it upon itself to run industry".

What the writer didn’t mention in his anti-British Rail tirade was that the state owned railway received over four times less money from the British taxpayer than today's privatised railway companies do- yet it still provided a far superior level of service to passengers- and much lower ticket prices.

But of course, what are little things like facts when you’re peddling neoliberal propaganda?


Thomas Cook- the world’s first travel agent -was born exactly 200 years ago this month (November). The company which the temperance campaigner from Derbyshire formed has a long and illustrious history- but what is almost forgotten today is that from 1948-72, it was owned by the British public. The company was nationalised as part of the British Transport Commission and stayed in public ownership until it was sold to a private consortium twenty-four years later. The idea of a state-owned travel agent would no doubt be condemned as ‘Stalinist‘ if mooted today- but the fact that the company stayed in state ownership under 13 years of Conservative Government from 1951-64 shows just how far the ideological pendulum has swung since then.


The former head of Coca-Cola once said he wouldn’t be satisfied until the ‘C’ on household taps stood for his company’s product and not ’Cold’. Well, if the neoliberal lunacy continues-we could soon be having the letters ‘M & S’ on our taps instead. Or even ‘T’ for Tesco. The Daily Mail reports that supermarkets could be given the right to supply water to Britain’s homes, after a government review had cleared the way for a shake-up in the sale of water, first to business and then to consumers. The proposal has received the backing from an industry review headed by Professor Martin Cave who enthused “Extending competition will deliver benefits for customers through lower prices, more choice, higher service levels and better use of water”.

Really? Haven’t we heard this one before? The very same claims were made when water was privatised in the first place- and twenty years on we’re still waiting to see any benefit to customers. There is a much simpler way to ‘deliver benefits for customers through lower prices’ and that is to restore water to full public ownership. When the industry was publicly owned, household water bills were so small no-one even bothered talking about them. Now they are a major item of household expense. Not surprising when you consider how many fat cats have their noses in the trough.

UPDATE: The Exile informs me that there's a typo in this post- I mistakenly typed in 'De' instead of 'Die' Linke.


Charlie Marks said...

The language used in discussing public ownership is curious. In sociology it's called a "discourse of derision" - in otherwords, badmouthing rather than offering a coherent argument.

I've spoken to people versed in only neoliberal economics and they find it very hard to escape this discourse of derision and actually think about how privatised utilities compare to publicly-owned ones. Interstingly, people versed in the economics of the real-world don't find it that difficult to compare their past experience of public utilities with their current experience of private ones...

Neil Clark said...

excellent point, Charlie. I think the 'discourse of derision' is all that the neoliberals-(and neocons for that matter), can do as the facts don't back up their arguments.