New Labour's moral capitalism!

In a speech on 19 January 2012, the Labour Party leader Ed Miliband demanded a moral capitalism with a special emphasis on the protection of consumers. What he overlooks, however, is that the real causes of inequality and exploitation are rooted in the social relations of production. Interventions at the level of consumption will not rectify this.


In his speech, Ed Miliband criticised heavily banks for their 'excessive' charges, train companies for increasing drastically rail fares on popular routes as well as too high car parking charges at train stations. He also demanded tighter regulation of hostile company takeovers (BBC News, 19 January 2012). 'We as a Labour Party are determined to be champions of the consumer', he declared (http://www.labour.org.uk/ed-miliband-on-responsible-capitalism,2012-01-19). Has New Labour identified a new group of exploited people it wants to help? Is this focus on consumption and the consumer the way forward to tackle increasing inequality in society?

What looks positive at first sight quickly becomes dubious, when analysed in more detail. Most importantly, Ed Miliband forgets that in order to be able to be consumers, people first must have a job in order to earn the necessary income. In other words, people are first and foremost workers, before they can be consumers in our capitalist society. As a result, the problem is not so much excessive charges by companies, but the high levels of unemployment and the deteriorating working conditions for those, who are in employment, including an attack on their pension rights, a fall in income in real terms with inflation outstripping nominal wage increases and a wider shift towards more temporary and precarious employment.

This misguided policy by New Labour becomes further obvious, when one considers its recent endorsement of the public sector pay freeze by the current government (BBC News, 15 January 2012), a pay freeze which leads precisely to the salary cut in real terms. In sum, New Labour's attack on consumer charges only deals with the symptoms of inequality and injustice in society. It does not tackle the more fundamental causes of exploitation as rooted in the social relations of production. New Labour, thereby, confirms yet again that it is no serious alternative to the current ConDem government.

Prof. Andreas Bieler
Professor of Political Economy
University of Nottingham/UK
Andreas.Bieler@nottingham.ac.uk

Personal website: http://www.andreasbieler.net
25 January 2012