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Not bold enough

2 March 2015 By Edward Hadas

Power sometimes tames rather than corrupts. Take Yanis Varoufakis. The new Greek finance minister once described himself as an “erratic Marxist.” But he no longer speaks like a professor provocateur. Gone are his rants about the dangerously flailing American financial beast he dubbed the Global Minotaur. Now Varoufakis is reduced to nudging his compatriots and placating European finance ministers.

The forthcoming general election in the UK means it should be open season for attacking conventional wisdom and suggesting radical policies. It is not playing out that way. The charity Oxfam, academics Colin Hay and Anthony Payne, and the Church of England have recently published books or papers with their best ideas about the British economy. The ideas could have been much bigger. The UK is missing its pre-election Varoufakis.

To start, there is a small-minded economic pessimism about the state of the UK economy, especially in comparison with most of the world. If the British are “a people in crisis,” as Justin Welby, the archbishop of Canterbury, claims, it is not because the economy is kaput. Nor does it make sense to describe the “Anglo-liberal growth model” as being in “ruins,” as do Hay and Payne. Even the more nuanced Oxfam research report on the UK exaggerates when it describes the country as “both environmentally unsafe and socially unjust.”

On a wider view, the key fact about the British economy is that it counts as developed. In other words, it is one of the most prosperous societies in human history, ever, without a doubt. The residents of developed economies set the global standard, historically and currently, for the consumption of comforts and luxuries and for living long, varied and healthy lives.

The UK’s record on education and for economic opportunity is a little less stellar, but still awesome by any reasonable yardstick. And while Hay and Payne claim that current arrangements are “environmentally unsustainable,” rich countries, including Britain, are actually becoming greener. Emissions of noxious substances have been falling for decades while energy efficiency has increased.

The critics are right to point out problems with the employment system and social safety nets. That is the least they can do. Still, pessimism is easily overdone. Oxfam finds that 3 percent of British houses are overcrowded and 7 percent of the population cannot afford an “adequate diet.” Those numbers are remarkably low, especially as the British housing system could do with some Varoufakis-style nudges.

The critics often emulate the tone of the great social reformers of the 19th century, who railed against the impoverishment of factory workers. But if they want to deal with an equally substantial issue, today’s radicals should ask, with furious intensity, how the British government and people can help lessen the greatest economic injustice of the current age – not inequality within rich countries, but the persistence of abject poverty globally.

About 15 percent of the world’s 7 billion people cannot afford anything like an adequate diet or adequate housing. And, as economist Martin Ravallion points out, more than 90 percent of the population in developing economies would count as poor in a developed country. That comes to about 5 billion poor people in poorer countries, compared to at most 80 million in the entire developed world.

Insiders are at work on the problem, but they have to be pragmatic. They must work at building institutions, targeting aid and encouraging investment. Radical outsiders are free to make more revolutionary suggestions.

One such idea would be to encourage greater migration from poor to rich countries. The poor people who move would clearly benefit and the countries they leave are probably also better off, thanks to cash remittances right away and the connections and expertise which expatriates eventually bring to the homeland.

For the rich countries, the chief benefits of freer immigration are moral and truly radical. To welcome poor people is a sign of generosity, which is right and good. More immigration might increase social burdens or lower average living standards for natives, especially in a Britain which refuses to supply enough houses to match demand. Brave critics of the current system would call for the acceptance of that possibility, to show their commitment to global, rather than a narrowly national, economic justice.

Those brave critics would also question the nation’s economic values. Even the Church of England’s text is surprisingly light on people’s excessive concern with wealth. The rhetoric against greed and a spiritually deadening addiction to technological novelty should be more fiery. There is room for a head-on assault on consumerism, materialism, advertising, financial speculation and frivolous luxuries. And how about some praise for moderation?

Would any political party advancing such an agenda have any hope of gaining power? Almost certainly not. But that’s the point of being an external voice. The current crop of outside critiques sound too much like they come from insiders. The politicians who will win the election might appreciate this practical advice. But the critics are squandering an opportunity to bring forward some truly radical ideas.

 

 

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