There is still a meaningful left-right distinction

There was an article in yesterday’s Australian Financial Review (July 12, 2015) – Left and right labels wear thin, lose definition – which as the title suggests tried to argue that it is hard “to know who or what is left or right wing any more”. The article used a number of examples, including the so-called Communist government of China bailing out its (farcical) share market and the Greek ‘far left’ government agreeing to austerity and on-going debt demands from the creditors, to suggest that it is no longer easy delineating what is left and what is right and dubbing policies accordingly (one way or another) “provides little illumination”. This is a recurring theme in recent years and part of the neo-liberal attempt to blur what it going on and treat ideological stances as reality or factual assessments. It is still very clear to me what is a left-wing position. The rest of the article provides in his own words “little illumination” about the issue. The argument in this blog is that the categories remain influential and meaningful but are blurred through ignorance as to how the monetary system operates. Left-wingers fall prey to right-wing policies because they have bought the TINA myth. That is the only way one could explain the Syriza disaster, for example.

The denial of the utility of the left-right divide is one of a number of strategies that have been deployed over the neo-liberal period to deter fundamental dissent.

I have just finished reading a book – The Government and Politics and France (Fifth Edition) – by Andrew Knapp and Vincent Wright (published in 2006 by Routledge). It helped me understand some of the historical developments in Europe.

In historical terms, we learn that:

France invented the terms Left and Right early in the great Revolution of 1789–94 which first limited the powers of, and then overthrew, the Bourbon monarchy. Those noble members of the first National Assembly who wished to limit the powers of the monarch moved to sit with the commoners on the left of the Assembly; those who still supported the absolutism of what was shortly to become known as the ancien régime sat on the right, as seen from the chair of the presiding officer.

These convenient ‘seating’ labels “had passed into general political discourse” by 1900 although as the authors note, the “terms …. Left and Right … have meant different things at different times” and there are “some political divisions … [mostly related to] … to foreign relations, which have never fallen neatly into a Left/Right categorisation.

In the French context, the early meaning of the division related to attitudes to monarchy, the separation of Church and state, etc, whereas later in the C19th, the issues were extended to included fiscal policy design to “finance social reforms: shorter working week; factory legislation” and later, a broader perspective on whether the replace capitalism with socialism via reformation or revolution.

The French right believed in absolute monarchy, blurred lines between the Roman Catholic Church and the state, particularly in the area of education (a greater role for religion in schooling), and as time passed, “Laissez-faire capitalism”, curiously, tempered by the “protection of French agriculture and industry” and no income taxes or income support measures for the disadvantaged.

After 1945, the French right conceded on the need for some social security capacity to be maintained.

The evolution of the French political system helps us understand more generally what these terms mean and whether they have become so diluted that we should cease to use them.

I don’t plan to offer a full historical account of the evolution of these ideas. That will appear (perhaps next year) in a book I am working on about the current state of the progressive left.

I am also aware that the terms have both cultural and national variations. So, for example, the very useful – Political Compass – reports that Americans typically contest the meaning of the term liberal, confusing it with the political tag attributed to the Democratic Party.

They argue that the American usage of these terms overlooks “the undoubtedly libertarian tradition of European anarcho-syndicalism”.

They note that the term “libertarian” was used in the European discourse “ong before the term was adopted by some economic rightwingers”.

In other words, you can be a left-wing libertarian (I claim that status) or a right-wing libertarian, depending on your economic perspectives.

Personal freedom does not equate to a free market. A state can have a large government with tight regulation of capitalist industry yet strong ideals for individual freedom.

Advancing individual freedom as a goal does not have to compromise a solidaristic collective approach to resource allocation and income distribution.

The Political Compass helpfully contends:

… that Left and Right, although far from obsolete, are essentially a measure of economics. As political establishments adopt either enthusiastically or reluctantly the prevailing economic orthodoxy — the neo-liberal strain of capitalism — the Left-Right division between mainstream parties becomes increasingly blurred. Instead, party differences tend to be more about identity issues. In the narrowing debate, our social scale is more crucial than ever.

They thus provide a four-quadrant assessment tool – with the horizontal extremes being the left-right economic divide and the vertical extremes being defined in terms of ‘authoritarianism’ (statist) versus ‘libertarian’.

The UK Guardian provided a breakdown of this framework for the British political system in this article (November 1, 2013) – Ukip has chanced upon the neglected part of British politics

The debate is highly topical at present given that the so-called extreme left Syriza party has seemingly fallen into line with a rather extreme right-wing policy framework, after its undoubted capitulation over the weekend.

While it might be difficult to pin down what a left-wing position is, the following propositions appear obvious:

1. A left-wing government would not accept policies that worsened unemployment.

2. A left-wing government would not accept policies that made the material standard of living of the most disadvantaged citizens worse off.

3. A left-wing government would not attack social welfare programs, including old-age pensions, minimum wages and housing subsidies.

4. A left-wing government would not seek to reduce job protections.

5. A left-wing government would not agree to privatise essential services (power, transport etc).

On all those accounts, the Syriza government is acting as a right-wing force in Greek politics.

A left-wing government would not aspire to be ‘pro business’ but rather realise that the relationships between workers and capital are antagonistic and the state has to act as a mediator between the two if the workers are to access the productivity gains of the system and enjoy income security.

I don’t necessarily consider that left-wingers have to support trade unions, especially in the current period where many trade union leaders have been found to have acted corruptly or questionably with respect to the trade union funds etc. In Australia at present there is a Royal Commission investigating trade union practices.

While the Royal Commission is a political stunt introduced by the Conservative government to undermine the reputation of the Leader of the Opposition, a former trade union leader, it is clear that certain leaders have done sweetheart deals with the bosses to advance their own material and political interest, while trading away the pay and working conditions of their members.

As long as there is a strong state which maintains full employment, strong job protection rules, occupational health and safety regulations, and effective anti-discrimination legislation, the workers will not be at a disadvantage.

Trade unions can help but only if they don’t become part of the neo-liberal corruption, which many seem to have fallen.

I realise that those on the left who also claim to be libertarian want more trade union control of workplaces as part of a move to decentralise power.

I have some sympathy for that view – especially the move to cooperatives and workers’ councils – but, first, the evolution of places like Mondragon are not confidence boosting (they have effectively falling into the neo-liberal vortex) and, second, and more importantly, an understanding of the monetary system, as provided by Modern Monetary Theory (MMT) requires the state to perform essential functions that cannot be taken over the decentralised entities without fiscal capacity.

That is one of the important insights that MMT offers. Whether one is of a left- or right-wing persuasion, one cannot escape the role that the state, as the currency-issuer plays in the smooth (or otherwise) functioning of the monetary economy.

Setting up a whole host of co-operatives does not reduce the need for appropriate fiscal functions at the national level, or in the case of the Eurozone at the federal level.

The essential problem of the Eurozone, as we all know now, is the lack of that federal fiscal function.

So an understanding of MMT, brings out the left and right divide into relief and allows us to see the on-going relevance of the distinction.

At present, because people generally do not understand the way the monetary system operates and the opportunities that currency-issuance bestows on the national government, politicians and commentators can base policies on myths and lies.

So we hear that the government cannot increase public employment because it doesn’t have enough money – and so higher than necessary unemployment becomes justified by appealing to a household analogy that there isn’t enough money to go around and sacrifices have to be made.

Even so-called progressives make that mistake and talk about introducing ‘fairer’ austerity, which is one of those vacuous political phrases that just tell us that the politician hasn’t got a clue.

The point is that if the population fully understood that the national, currency-issuing government ‘can never run out of money’ then the justification for maintaining higher than necessary unemployment is called into question.

It then becomes obvious that the politician making that statement must want unemployment to remain high for other reasons. Right-wing reasons, such as, disciplining pay demands to allow capital to receive higher real income shares than would be forthcoming if fairer (left-wing) distributions were made.

The political debate would become much more transparent again and the right- and left-wing divide would be clearer again to all.

At present, things are so-blurred by the outpourings constantly hitting our TVs, radios, newspapers, Internet outlets, etc by the neo-liberals that we have lost that sense of motive.

TINA claims deny motive because the proponent doesn’t want us to know that their motives are such that we couldn’t possibly support the policy.

By making it out that there are no alternatives, we are less able to reject policies that damage us.

That is one way I am seeking to understand what has happened in Greece in the last few weeks. It is clear that the Greek people mostly want to stay in the Euro and the so-called left (not) government has taken that as an iron clad priority and partnered with the extreme right-wing (Troika) and agreed to a horrendous suite of policies that will inflict further deep harm on the population.

The question then is – is the preference to remain in the Eurozone rational and informed?

My view is that it is not an informed viewpoint. None of the political parties in Greece appear to understand what the alternatives are. Some individual politicians seem to realise that an exit is not rocket science and requires a set of procedures which are well known and relatively easily implemented to be followed.

The population has little understanding of the nuances of monetary systems and have been bombarded with lies about the alleged ‘catastrophic’ consequences of reintroducing their own currency.

The arguments about Greece having to remain in the Eurozone to be part of Europe are equally ill-founded. Given the behaviour of the European elites in the last weeks, one wonders what the ‘European Project’ has become anyway.

But a left-wing position has to support the sovereignty of each nation, by which I mean the capacity to issue one’s own currency, to float it on international markets and to set one’s own interest rates.

That is the only way to guarantee that the state can advance the traditional left-wing interests of pay equity, income security, freedom to associate, full employment, and more recent ambitions such as environmental sustainability.

By entering the monetary union, each nation surrendered that capacity and I would argue all political parties that supported the Maastricht Treaty and have implemented it since forfeited their left-wing credentials and became part of the neo-liberal right-wing machine.

It is thus clear to me that the terms – right and left – still resonate, once we pare away the sleight of hand that the mainstream use to discredit differences of opinion and policy alternatives.

The TINA mentality clearly requires a conflation of ideas into the ruling ideology for its success.

The strengthening Groupthink among policy makers around the world, developed to a high form among the European political class, has clearly sought to suppress dissent, destroy any rogue political parties and maintain an iron grip on economic policy so that it advances the aims of capital, first and foremost.

A left-wing position would consider it a primary goal of society to advance human development irrespective of race, gender or age.

The right-wing deny there is a thing called society.

Left-wingers want policies introduced that break down barriers to such advancement.

The Troika advances policies that negate human development, discriminate against age (the entrenched youth unemployment tells you that), and they build barriers to subvert such advancement.

An examination of the British fiscal statement last week (which I am still reading about) tells us that the state has moved against its youth.

The TINA myths, are akin to the situation in the late 1990s, when mainstream economists started claiming that the “business cycle was dead”. Remember the so-called Great Moderation, which purported to deny a role for government in terms of fiscal stabilisation policy and concentrated the policy debate onto microeconomic reform, which meant – deregulation, privatisation, outsources, welfare retrenchment etc.

Please read my blog – The Great Moderation myth – for more discussion on this point.

A decade later (or so) the GFC proved the business cycle was not dead and that the claims that a self-regulating free market would deliver wealth for all was a myth of the most insidious type.

Conclusion

So for me – I consider it essential that people understand the way the monetary system works so that the deceptions that clothe the ideological persuasion of the person, cannot be hidden with smokescreens and lies.

Then it will be obvious to all whether they are ‘right-wing’ or ‘left-wing’.

A little aside

A number of people have railed against the anger I directed at ‘Germany’ and to a lesser extent Finland in recent posts. I don’t resile from that anger. The evidence coming out is that German delegates (Finance Minister, Chancellor) dominate EU meetings and have used bullying tactics to deliver unreasonable outcomes for Greece to say the least.

There was an interesting comment in this regard by a German commentator Henning Meyer who is “Editor-in-Chief of Social Europe and a Research Associate of the Public Policy Group at the London School of Economics and Political Science” in the Op Ed article (July 13, 2015) – What Are The Consequences Of The Greek Deal?.

He wrote:

The suspicion of Germany is back. This is very painful for me as a German but I am afraid that Merkel’s and Schäuble’s politics have been nothing short of a disaster for Germany too (in addition to Greece and Europe). For years, the population has been fed a wrong narrative of what the real problems are and the ruthlessness with which a purely national view was enforced has nothing to do with European partnership anymore. Especially Schäuble has become a real liability. He should pack up and leave office immediately.

That is why the ‘ugly German’ is back at the centre stage.

He also said:

A senior official in the room believed that Germany was now the country that appeared to be acting in bad faith …

Along with the lackeys (Finland and Slovakia), the behaviour of German politicians, who represent the nation in international affairs has been deplorable.

They have used scaremongering and played on the socio-pathological fear of inflation among the German population domestically to exact cruel and harsh penalties on Greece.

As the Slovenian Prime Minister Robert Fico claimed yesterday – Greece is now an “EU protectorate” aka a German colony.

That is why I invoked the ‘ugly German’. The behaviour is manifesting differently than in past historical epochs, but the treatment of fellow European citizens by the German state remains deplorable.

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That is enough for today!

(c) Copyright 2015 William Mitchell. All Rights Reserved.