I can only see progress—technological, political, social, moral, whatever—as a goal of human action and since progress has no will or direction of its own and depends entirely on what people do or don’t do, it’s neither contented or discontented about anything. As judges of the direction human affairs and the world are taking I am, and practically everyone I know is mightily discontented with the cumulative effects of changes brought about over the past several decades.
12 November 2015 The audio of the lecture can be heard here.
Good evening to all. It’s a great honour and a pleasure to be with you as part of this prestigious lecture series and I want to thank especially Professor Robin Archer who is in charge of it, his assistant Maya Goodfellow who has dealt with all the logistics and the anonymous donor whose generosity has brought me and other speakers in this series to London. I’m also thrilled because I’ve been invited to speak on a special occasion at the world-renowned London School of Economics.
When I saw the title of the series, I was a bit taken aback. “Progress and its Discontents” would require a real exam-candidate’s deconstruction for which we haven’t time. And I’ll also resist the temptation to hold forth on Freud and Civilisation which he thought was also rife with discontents so that we can get down to business.
To start with my own position, I can only see progress—technological, political, social, moral, whatever—as a goal of human action and since progress has no will or direction of its own and depends entirely on what people do or don’t do, it’s neither contented nor discontented about anything. As judges of the direction human affairs and the world are taking I am, and practically everyone I know is mightily discontented with the cumulative effects of changes brought about over the past several decades.
Progress is a relatively recent concept and it’s not universal. I can’t say to what degree the idea is still generic to the West and part of the intellectual equipment of just a small part of humanity. Certainly before the Enlightenment, the word was only used to describe forward movement in space or time—notions of moral, technical or political progress were limited to such free spirits as Descartes and Locke. However, Descartes’ injunction that we should use our scientific and technical knowledge to become “maîtres et possesseurs de la nature”—masters and possessors of nature, rings dangerously false in these times of devastating climate change considering what a rotten job we’ve done of mastering nature, much less understanding and cooperating with its laws.
The present notion of progress only became mainstream in the 18th and 19th centuries. It was a time when the French revolutionary Saint-Just could say “Happiness is a new idea in Europe” and Thomas Jefferson could write in the Declaration of Independence that among the inalienable rights of human beings are “Life, Liberty and the Pursuit of Happiness”. Here the concept means moving towards an identifiable objective, or satisfying an aspiration; it tells us that starting from a state of unhappiness or at least stagnation and monotony, an individual can actively define and seek out something better. When it’s a collective pursuit, say the New Deal in the 1930s or the war effort against fascism, it can result in a higher degree of happiness for a much larger group, perhaps an entire people, and if you want to dream, for the world. That’s what people dreamed about 70 years ago when the United Nations was founded. So it’s a great idea although it’s possible to argue that many parts of the world never made this Enlightenment journey characteristic of the past few centuries in the West; and the West itself can hardly be praised for its conduct during that period, given the realities of slavery, colonialism, the two bloodiest wars in human history, genocide--the list goes on. The West is no paragon and Westerners are ill-suited to be delivering lectures about progress to the rest of the world.
So maybe the idea is still limited to a minority on our planet. If you sincerely believe, for example, in the divine origin and ordering of the world and of your own existence, then trying to change anything fundamental about either can border on the sacrilegious.
Perhaps you remember the wonderful scene in the film Lawrence of Arabia in which a swashbuckling Peter O’Toole stars as T.E. Lawrence. At one point, he rides out into a desert sandstorm to find a man who has not returned to camp. All the Arab warriors tell him not to interfere, the man will disappear and die. His fate is sealed, it is the will of Allah, it is written. When at last O’Toole-Lawrence rides back into camp with the man, alive and slung across his saddle, he announces to the incredulous group of Arabs, “Nothing is written”. Great cinema—and that line also tells us Lawrence is a Westerner through and through. He doesn’t believe that the human world is organised according to divine plan.
I don’t know much about Oriental philosophy but I would also imagine that the concept of progress is utterly foreign to all the civilisations in which a basic element is a cyclical notion of time, the Eternal Return. The same would be true for all the agrarian societies where the unending return of the seasons is the only constant. Added to the Islamic world, that adds up to a lot of people!
Obviously none of this implies that non-Westerners are incapable of envisaging progress in the same way as Westerners, nor that there aren’t a lot of Western fatalists—including the many who can be counted on to tell you that all politicians and all governments are the same and that nothing will ever change, so why bother to vote or be politically active.
So let me just affirm here my own belief that progress--technological, social, political and perhaps even moral--can exist, does exist; it has its setbacks and also its advances. Anyone who considers himself or herself a “scholar-activist” or “public scholar” has to believe in it and I see it as the duty of all who call themselves progressives to live up to their name: it is possible to seek progress despite the odds. Here is my proof-of-the-pudding argument in the form of an apocryphal story.
We’re in the 1960s. Fidel Castro and Che Guevara are talking. Che asks Fidel, “Do you think the Americans will ever lift the blockade on Cuba?” Fidel replies, “That will happen when the United States has a black President.” “Yeah”, answers Che, “and the Church has an Argentinian Pope”. So, yes, it can seem to take forever, a huge amount of damage may be inflicted in the interim, there’s a lot of bad news arriving daily and it’s only human to grow discouraged sometimes. But things can and sometimes do change for the better. History isn’t over. We have no claim and no right to believe that we know the future. Those who settle into despair and pretend to know the future can count on only one thing: they are contributing to failure. Antonio Gramsci said it this way: pessimism of the mind but also optimism of the will. That optimism of the will may also be called hope.
Right now I’m personally hoping to have cleared a path forward in the discussion so that we can move to the main points I want to make this evening. I’ll stick to political, social and economic progress or regression. Psychologist Steven Pinker tells us our societies are growing steadily less violent and any issue of the New Scientist is reassuring on the constant progress in Science and Technology but I’ll leave the moral and scientific aspects to those far more competent than I. I want to talk about the victory of neoliberalism and how it came about.
This victory is easily the worst and longest-lasting regression I’ve witnessed in my lifetime. Many date this victory precisely to 1979-1980 with the electoral victories of Margaret Thatcher and Ronald Reagan and anyone under 40 can be excused for thinking politics have always been this way. Certainly those elections were decisive, but the roots of this counter-revolutionary change go far deeper. One can actually date the onslaught to the founding of the Mont Pèlerin Society whose first meeting was held in the Swiss village of that name in 1947 under the leadership of Friedrich von Hayek and his much younger disciple, Milton Friedman. Mont Pèlerin has since received hundreds of thousands of dollars in support from conservative donors and has about 500 members from dozens of countries. All its presidents have been neoliberals, sometimes famous prize-winning ones such as Gary Becker. Margaret Thatcher wasn’t so much a Thatcherite as a Hayekian and was a member of Mont Pèlerin until her death. It was a revolution of ideas against which progressives could not or would not defend themselves and the neoliberal revolution which was brought about entirely by the power of ideas is ultimate proof that ideas have consequences.
In 2008 I published a book called Hijacking America describing empirically how American neoliberals, with help from the Evangelical Christian movement, brought about a profound intellectual transformation in the United States, from whence it has spread to the rest of the world. These intellectual warriors are still in process of destroying virtually every social advance made in the United States and Europe since at least the beginning of the 20th century but especially since the end of World War II. Their policies have instated the opposite of progress; rather a regression to a meaner, more cruel, more inequitable and unfair society. The ideology of neoliberalism has infected all the traditional labour or socialist political parties in Europe which were once on the left. There are a few hopeful signs that we may be emerging from this decades-long tunnel but they must be carefully nurtured if they are to lead to genuine progress or at least put a stop to regression. Right now Spain and Portugal are very much worth watching and here in Britain the victory of Jeremy Corbyn show that the ice is starting to crack.
The subtitle of this 2008 book was “How the religious and secular right changed what Americans think” and I tried to show how those I call the “right-wing Gramscians” established their own cultural hegemony. Let me stress the word cultural: Gramsci understood that no regime could rule by force and coercion alone. People also need and want a belief system and as Gramsci puts it, a major characteristic of “any group that is developing toward dominance is its struggle to assimilate and to conquer ideologically the traditional intellectuals.” The new group seeking power must also develop and nurture its own “organic intellectuals” as he calls them. To accomplish this, those who seek dominance must also make “the long march through the institutions”. This is exactly the programme the neo-liberals understood and carried out. By now they have either bought off or marginalised most of the “traditional intellectuals” and they have developed their own cadre of extremely well-paid “organic intellectuals” who work in such centres as the Heritage Foundation, the American Enterprise, the Cato or the Manhattan Institutes; as columnists and contributors in the mainstream media and in a great many universities. They had their gurus—the most famous being Friedrich von Hayek who taught at the University of Chicago but also, later on, former radicals like Irving Kristol who justified his own conversion to neoliberalism by saying he was a leftist who had been “mugged by reality”. Kristol, who died in 2009, was a godfather figure with a clear strategy: his goal was to build the right’s own rival institutions to what he saw as the left’s pernicious, liberal ones—the universities, the media, think-tanks, NGOs, foundations, even the courts. It wasn’t hard to sell this strategy to a good many corporations and especially to several major private American foundations based on huge industrial fortunes that generously funded the entire enterprise. It cost them well over a billion dollars but they got more than their money’s worth—they got a whole new American mind-set, a whole new America and a whole new world.
A parenthesis here: the fall of the Soviet Union and the end of the Cold War contributed enormously as well to the spread of neoliberalism eastward, but we can’t deal with all the geopolitical aspects in a relatively short talk. The ideas these intellectuals promoted are today so commonplace that the younger people here may be surprised that it hasn’t always been that way. Here is a quick and rudimentary resumé of the doctrine:
Some parts of the doctrine are mostly reserved for United States consumption alone but the occasional Tony Blair or Peter Mandelson may use them as well. For example, neoliberals (and their close allies called neoconservatives) believe that the United States, by virtue of its history, ideals and superior democratic system should use its economic, political and military force to intervene in the affairs of other nations in order to promote free markets and democracy. People in other countries will necessarily welcome such interventions because they can rid the world of vile dictatorships and other undesirable elements and will ultimately prove to be for the good of all. That was Blair, along with his well-known belief in non-existent Weapons of Mass Destruction. As for Peter Mandelson, another prominent, nominally Labour politician, he announced in 2002 to a group that included Bill Clinton and a variety of so-called socialists, “We are all Thatcherites now”. Quite so. Such is the doctrine, these are the principles that brought us the economic crisis of 2007-2008 in which we are still mired, great leaps forward in inequality, huge unemployment, unpayable debts and the like.
It wasn’t just intellectuals and funders who put neoliberalism in the driver’s seat worldwide but also a huge array of skilled communicators, rhetoricians and PR professionals. They are now part of the political and economic landscape and their role in promoting neoliberal ideology remains paramount. The foundations pay for a cadre of experts in academic and non-academic institutions and think-tanks. These experts spoon-feed journalists with well-prepared press releases and briefings, they have their own radio and TV studios on their premises and can supply articulate debate participants to CNN or other TV networks. In the print medium, they cover—and fund--everything from scholarly quarterlies to campus newspapers.
The Olin Foundation is a good example of the role of funders. Based on an industrial fortune made from chemicals and munitions, it’s an excellent example of investing in ideas that have consequences. It opened in 1953 and shut itself down in late 2005 to conform to the founder’s will that its hundreds of millions of dollars be spent in the generation following his death so that his purpose of supporting free market thought would always be respected. Olin concentrated on funding conservative think tanks, media outlets, and “law and economics” programmes at influential universities. The professors who hold these chairs teach free-market economics and emphasise “economic efficiency and wealth maximisation as the conceptual cornerstones for judicial opinions”.
The Foundation is perhaps best known for its massive support to the Federalist Society which, as the Olin Foundation wrote to its trustees in 2003, “has been one of the best investments the foundation ever made". With at least 60.000 members who are law students, lawyers or law faculty members, the society has enormous influence on American law and jurisprudence. At least four members are now Supreme Court judges, every federal judge named by Presidents Bush père and fils has been either a member or been approved by the Society. Other wealthy foundations may have chosen different beneficiaries but whoever the recipients, these foundations have never varied in their goal of changing the intellectual landscape and they have excelled at making corporate and private wealth secure, often at the expense of individual rights, labour rights and environmental protection. This vast intellectual apparatus acts as an “ideas legitimizer.”
As for the consequences, let me take a single example. As you probably know, thanks to recent Supreme Court decisions, especially one known as Citizens United, corporations and their owners can now make unlimited financial contributions to the parties and the candidates of their choice. Such donations are now classed as a form of “speech” protected by the First Amendment to the Constitution. This decision bears all the hallmarks of the Federalist Society and its donors and has introduced even greater corruption in an electoral system that was already far too dependent on big contributors. At about the same time that the neoliberals were beginning their long march through the institutions in earnest, the US Chamber of Commerce teamed up with the distinguished corporate lawyer Lewis Powell to admonish the big American corporations for not defending the capitalist system that brought them their profits. Powell, who later became a Supreme Court Justice under President Nixon, wrote a hugely influential document in the form of a memorandum to the head of the Chamber of Commerce, explaining how and why the free enterprise system was under threat. The anti-Vietnam war movement plus many other growing social movements were reducing support for capitalism all over the country, especially on university campuses, and he told the corporations that they had to become genuine activists.
Powell’s memo reads like a kind of Leninist “What is to be Done?” pamphlet for big business. They must not only name top officers in their own companies to deal with the threat but work together as a counter-movement. As Powell puts it, “independent and uncoordinated activity by individual corporations will not be sufficient. Strength lies in organisation and careful long-range planning …over an indefinite period of years in the scale of financing available only through joint effort and in the political power available only through united actions and national organisations.”
Today, it may seem to you utterly surreal that Powell in 1971 could say the following to his audience: “Few elements of American society have as little influence in government as the American businessman”. But at that time, he was talking sense, and the corporations listened. They took his advice and began their own long march to educate not just the public but the politicians and to change the law to meet their needs. Cooperating with the US Chamber of Commerce, in cash terms still the biggest lobbyist in United States today, they began to work together and saw quick results, such as preventing an increase in the minimum wage. Since those days, business has never looked back.
This is why, as I explain in my new book called Shadow Sovereigns, we are venturing into territory which has been utterly transformed over the past 30 years. The French version of this book came out almost a year ago and is titled Les Usurpateurs, The Usurpers. True, it doesn’t sound too great in English but it tells you perhaps more directly than the title Shadow Sovereigns that we are up against a genuine threat of political takeover by giant corporations, elected by no one, and completely liberated from any inhibitions they might have had in the early 1970s. A government of, by and for the largest companies is by its very nature illegitimate.
Please let me clarify this. I am not saying that these huge companies want to sit in the Oval Office or in number 10 Downing Street. They have no desire whatsoever to deal with the nuts and bolts of government much less put up with the burdens of elections. A few areas of law-making are of no interest to them, but wherever there is money to be made and their profits and status are in question, they want to set the agenda, fix the parameters and make sure that their interests come first. Those interests may include labour laws and taxes but also public health, food and agriculture, environmental protection, safety regulations and a great deal more.
So you are not going to find the corporations themselves at front and centre stage. Just as they have politicians to do their will, so they also have thousands of paid lobbyists to handle the day to day business of persuading the relevant person to act on the relevant arguments the company defends. The big names are those of the top people in the US Chamber of Commerce or its counterparts Business Europe or the ultra-exclusive European Roundtable of Industrialists for the big displays. This European Round Table is an exclusive club for about 50 of the chief executives of the most powerful companies and as Peter Sutherland—himself a former head of the WTO, a European Commissioner and top man at Goldman-Sachs and BP says, “[The ERT] is far more than a lobby group. Each member has access at the highest levels of government”.
The lobbying industry is also highly sophisticated and pretty much escapes political control, especially in Europe. In the United States, lobbyists must register with Congress and there are penalties for not doing so. In Europe there is a register, but it’s optional and if you choose to fill in the questions you can supply whatever figures suit you, including how much you are paid, by whom and to lobby for what. The researchers at the Corporate Europe Observatory in Brussels are experts at pulling obvious anomalies out of the registry and have with others been demanding a compulsory registry for years, but to no avail. And despite Jean-Claude Juncker’s election speech promise to establish one, such moves have been constantly thwarted. Changes are refused for impenetrable legal reasons. What these tactics come down to is that the Commission doesn’t want a compulsory register that would release details about who pays for lobbying whom because such details would implicate the Commission itself. The Corporate Europe Observatory, an NGO in Brussels, successfully obtained the release of documents concerning the meetings the Commission held with various interest groups in 2012-2013 before the negotiations of the Transatlantic Trade and Investment Partnership or TTIP were launched. I’ll come back to the TTIP in a moment. The upshot was that the Commission held over 120 meetings and more than 90 percent of them were held with corporations, their lobbyists, their federations or their top brass. That left precious few meetings for environmentalists, trade unions, consumers, public health organisations or other associations defending non-commercial interests.
I’m rather proud of my short catalogue of lobbying techniques in the book and am sorry we haven’t time go over them all. But you should at least know that if you can’t defeat a measure, you can usually delay and weaken it and create doubt in the public’s mind. Tough tobacco legislation was kept at bay for decades using variations on this theme. It’s also good to argue the sanctity of consumer choice, especially in cases where people may want to eat, drink or smoke themselves to death. Always stress jobs and growth no matter what the subject and explain that whatever your opponent wants to do will lead to higher prices and unemployment. You can count on being asked very few difficult questions. Despite the Volkswagen scandal, and marginal progress in setting new standards for tests, nothing will be obligatory before 2019.
People often ask why governments follow business demands so closely and accede to them so often. That’s a question for Pierre Bourdieu who unfortunately is no longer with us to answer it. Is it because the leadership on both sides belongs to the same social milieu? Or is it because the business community puts forward arguments that really are convincing and in some areas like banking, so technical that they can overwhelm poor non-specialist politicians? Or do politicians really believe that their country’s GDP and trade balance depend on doing what the companies want? Or could it perhaps even be because many of the politicians have grown up under neoliberalism and nobody ever taught them any other sort of economics? I suspect the answer is probably all of the above, but I think there is also an element of quasi-religious belief involved in which salvation is based on faith, whatever the evidence of efficacy. The politicians do not seek and therefore do not find an alternative.
Much more is known now about the TTIP—the US-EU Trade and Investment Treaty--than was generally known when I was writing Shadow Sovereigns in late 2013 and early 2014. I will assume that anyone in the general radius of the LSE knows the basics and the main things wrong with it. I would like simply to underline a few points. The first is that the TTIP is a frontal assault on democracy. It is entirely based on a corporate project which began twenty years ago when in 1995 the Transatlantic Business Dialogue held its first meeting. This so-called “Dialogue” was made up of about 70 of the largest transnational companies with headquarters on both sides of the Atlantic and from the beginning they were sponsored by the US Department of Commerce and the European Commission, particularly the Trade Directorate. These companies organised working groups according to professions—vehicles, energy, pharmaceuticals, chemicals and so on. They set out to work on common standards and regulations and their slogan is a triumph of modesty and self-effacement: “Approved Once, Accepted Everywhere”, meaning that if we, the Transnationals, have approved a regulatory procedure or a common standard, then you, ordinary mortals, as well as governments had better accept it too.
This structure evolved over the years and in its latest incarnation is called the Transatlantic Economic Council, established in 2007 by Chancellor Merkel, President Bush and Commission President Jose Manuel Barroso. This may sound like just another shop for greasing the wheels of commerce. However, the first thing this TEC tells you on its website is the following: “The Transatlantic Economic Council is a political body to oversee and accelerate government-to-government cooperation with the aim of advancing economic integration between the European Union and the United States of America”.[emphasis mine]
It’s not elected and few have heard of it but it’s “political”, and its goals also include “empowering the private sector”, as well as “advancing economic integration between the EU and the US” which no one to my knowledge has ever voted for.
These are the people who for years have prepared the TTIP negotiations and have now handed their wish list to the official negotiators. The corporations thought it would go through quickly and virtually without comment but unfortunately for them, this secret treaty worried a lot of people in the US and Europe, including me, who started investigating it. It’s the subject of the longest chapter in Shadow Sovereigns and I think deserves to be, since it shows how deeply the companies want to change and control our politics. I called it an assault against democracy and concretely you can start with secrecy, even from parliamentarians. Other anti-democratic features are its quasi-irreversibility if it is signed, zero citizen contribution to the contents and the intention of making it an “everlasting agreement”. This means that clauses too controversial to be included now can be added after signature and will have the same legal force but again no input from the public.
National legal systems become subject to ISDS or Investor to State Dispute Settlement, which is a one way street. It allows a corporation to sue a sovereign State in a private tribunal of three professional lawyer-arbiters if the company believes its “legitimate expectations” have not been satisfied or its profits, present or future, harmed in any way by a State measure. The system is not reciprocal—a State cannot sue an investor, there is no process of appeal, and so far, on the basis of some 320 decisions reached under the same provisions in other trade and investment treaties, the State has been exonerated in 37 percent of the cases. The rest—63 percent-- have thus resulted in an award to the company—often extremely expensive—or an-out-of-court settlement between the two parties of which the results are confidential. All the cases are costly with taxpayers paying an average of $8 million in costs and some longer cases ranging up to $30 million. If we were talking about so-called Third World judicial systems subject to corruption, this ISDS might be justified. This is certainly not the case for the courts in Europe or the United States.
The other big subject on the corporate mind is what they call regulatory reform and here their goal is to get in on the ground floor and participate in the regulatory process itself, handily dismissing the legislators whose job this usually is. The technical agencies would also help in setting rules, but we know that the expert groups advising the EU bureaucracy are about 85 percent made up of corporate experts. The agencies overseeing sectoral concerns such as food, medicines, environment and so on are also mainly constituted from once and former corporate people. Finally, the revolving door between the bureaucracy, the Commission itself and private enterprise is spinning faster and faster with people seamlessly passing from employment in one to the other.
Just as a final word about progress and without elaboration, I want to make two more points. First: At the individual country and the European level, we have got to get rid of austerity programmes, the quintessential neoliberal nostrum that doesn’t work except for a tiny minority. They didn’t work during the debt crisis in the South during the 1980s and 1990s and they don’t work in European countries today. Even the International Monetary Fund which was an architect of austerity in earlier decades, then known as “structural adjustment programmes” now recognises that these programmes don’t work and has said so in a number of publications. What happened to Greece this summer is shameful and dishonours Europe. The programme forced down Greece’s throat is a pure product of ordo-liberalism, the German variety of neoliberalism based on the same dogmatic, unverifiable postulates which lead to the same policies guaranteed to worsen suffering and solve nothing. In Germany, as Wolfgang Munchau has written in Financial Times, there are two kinds of economists: those who haven’t read Keynes and those who haven’t understood Keynes. Let us hope that the destiny of Podemos in Spain will be a more promising one; that the new Portuguese coalition between “wet” socialists” and more radical progressives may work and, while I’m at it, let me express my hope that Jeremy Corbyn will have the destiny here that he and Britain deserve.
Second, let me remind us all the climate change is the most serious, life-threatening, species-destroying challenge ever to confront the human family and therefore the most urgent one on which we must make progress now, literally on pain of death for millions. We are on the brink of the Paris Climate Conference, the “Conference of the Parties” or COP21, which will not guarantee that we remain under the dangerous threshold of 2 degrees Celsius. Except for the corporate sponsors of the denialist movement who are truly climate criminals, I did not deal with this issue in this book although I have done so in others. Ninety corporations, including 50 investor-owned and 40 state-owned entities, are responsible for 63 percent of all the CO2 emissions historically emitted worldwide since the mid-18th century and the beginnings of the industrial revolution. We must imperatively leave 80 percent of all the fossil fuels still unburnt or face extinction—it’s as simple as that. We must work for disinvestment in fossil fuels, work to expand the transition towns movement, work to make governments invest in the transition economy. This is not a question of progress or regression but of progress or else. Time is short.
I think by now you will be tired of me, so I want to thank you for your kindness and instead of concluding myself, and I’ll leave my conclusion about the power of neoliberalism and transnational corporations to someone else. This person said, In the course of my life I have developed five little democratic questions. [Ask a powerful person]: ‘What power have you got? Where did you get it from? In whose interests do you exercise it? To whom are you accountable? And how can we get rid of you?’ If you cannot get rid of the people who govern you, you do not live in a democratic system.
That was Tony Benn, 1925–2014, in his Farewell speech to Parliament, 2001.
Thank you.
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