Roosevelt, Fascism, Woke Capitalism and 'Coups Against Democracy' (part two)

 To utterly mangle a famous Bob Dylan lyric, “history doesn’t rhyme, it swears”.

In April 1938, in a speech to the American Congress, Franklin Roosevelt said that “unhappy events abroad” (meaning Europe) had imparted two “simple truths”.

The first was that democratic government was threatened by the “growth of private power to a point where it becomes stronger than [the] democratic state itself”. That, in essence, was Fascism, he said.

The second was that the “liberty of a democracy is not safe if its business system does not …. produce and distribute goods in such a way as to sustain an acceptable standard of living”.

“Both lessons,” said Roosevelt, “hit home”.

The Hubris of Wealth

Sadly, 88 years on, they are hitting home again. Though our situation is probably more perilous in that the American president is the “essence” of the problem, rather than the one stating its existence.

A general myopia regarding the situation also makes combating it far more difficult. Many understand Roosevelt’s second “truth” – that falling or stagnating living standards provide fertile ground for far right and Fascist parties. Anything from high rents, to failing public services, to a callous ‘welfare’ system are blamed on immigrants or lazy freeloaders, or both.

But the first “truth” – interestingly Roosevelt placed it first so as to emphasise it – is less appreciated. But, as part one I hope demonstrated, “the concentration of private power without equal in history” is now actually worse than it was in the 1930s. And its producing similar effects.

So while Fascism is incubated by social conditions that affect the mass of people and unsolved and misunderstood economic afflictions, it also has a corollary at the top of society.

As Roosvelt noted at a time when Nazism thought it would last a thousand years, economic concentration and the growth of corporate power leads to a hubris among rich capitalists that they can discard democracy and institute a government seamlessly suited to their profit-maximising needs. This allies with the Fascist impulse at the bottom of society to produce a low-tax, deregulatory political project that, on its reverse side, constantly seeks scapegoats to blame for problems that are never addressed.

First on the Fascist ‘To Do’ List

We can see this in the actions of classical Fascism – the political environment that Roosevelt was confronting. The absolute first priority of the Hitler regime in Germany, as befitting its bankrolling by wealthy industrialists, was to repress the Left and puts its activists in concentration camps like Dachau. This started with the Communists in February 1933, and then within weeks extended to the Social Democrats and the trade unions. Only after this had been done, did the Nazis turn their attention to Jews, initially through a boycott of Jewish businesses. “There were relatively few Jews among these early prisoners of the Third Reich,” writes historian Arno Mayer in Why did the Heavens not Darken? “and all of them were arrested for being left-wing politicians, lawyers, or literati.”

The original Fascist regime, Mussolini’s in Italy, ceded a lot of power to a coterie of mainly non-Fascist economic advisers. As shown by Clara Mattai in The Capital Order, they instituted a system of brutal austerity and privatisation, which seamlessly dovetailed with Il Duce’s physical smashing of the workers’ movement, and coincidentally caused a massive, though far from unwelcome, slump in living standards.

Roosevelt, in keeping with someone who didn’t consider himself a socialist, thought the intrinsic problem with Fascism was that it rested on a particular type of capitalism. This was the cartel system – groups of companies that become so powerful they can fix prices, distort markets and take over governments so their interests are tended to.

And it is true that, contrary to the contemporary Right’s absurd portrayal of it as socialistic, Nazism had a private profit-making impulse at its core. As Hannah Arendt relates in Eichmann in Jerusalem (p 40), IG Farben, Krupp and Siemens all had plants in the vicinity of Auschwitz and made a pot of money by ‘employing’ its inmates as slave labour.

Nazism and Cartels

As the Rooseveltian moment reached its zenith – i.e. before the Cold War took root and the US started installing and supporting right-wing military dictatorships across the world – the cartel system was blamed for Nazism. The chairman of the US Senate’s Subcommittee on War Mobilization stated that the cartel system was “in great measure” responsible for the Hitler regime. Roosevelt himself wanted the German cartels eradicated and a “Decartelization” team was dispatched to post-war Germany to do just that (with the exception of IG Farben unsuccessfully).

But as shown by the fact that the German cartels existed prior to Nazism, and in fact were instrumental in helping Hitler into power, cartelisation is always an inherent possibility with capitalism. This is especially the case when – as they have been since the Great Depression –economic downturns are nipped in the bud by government intervention and a widespread destruction of capital is not permitted to happen.

In 2012, two American Marxian economists, in a book called The Endless Crisis said that economic concentration, though frequently denied, was greater than it had ever been in the past. They cited another economist who found 22 “barriers to entry” used by firms to exclude rivals, prima facie evidence of a cartel system. And given what has happened in the interim, including a spate of mergers and acquisitions in the wake of Covid, economic concentration has almost certainly become more extreme.

In such circumstances, the temptation to wield the power of market influence and wealth can become irresistible.

Last year, the anti-monopoly group the Balanced Economy Project and the NGO Global Justice Now, urged an investigation of three pharmaceutical giants who had paused investments worth £1.5 billion as prelude to negotiations with the government over drug purchases by the NHS. This, they said, “showed signs of cartel-like behaviour”.

As it turned out, the Competition and Markets Authority, permeated with the Starmer (read now Burnham) government’s growth mantra and horror of seeming to impair business ‘confidence’ refused to investigate. The subsequent talks, carried out under the shadow of threats to withdraw investments, saw the NHS promise to double spending on new drugs at a cost of £64 billion.

Billionaires and the Far Right

It is not hard to see an echo of the German cartels’ role in the rise of Nazism, and participation in its horrors, with billionaire sponsorship of the far-right today. Elon Musk pays Tommy Robinson’s legal costs, calls for the British government to be overthrown and supports Restore Britain. Palantir founder Peter Thiel thinks freedom and democracy are incompatible, while backing Donald Trump and the far-right. Trump’s immigrant detention centres are built and operated by private corporations.

Conveniently, those supported by these techno-billionaires (or trillionaires in the case of Musk) promise to tear down regulations banish abominations like a wealth tax. According to Facebook whistleblower, Sarah Wyn-Williams, offering electoral campaign tools to the far-right Alternative fur Deutschland and the Front National in France was seen as a way of “getting close to these political parties and helping them into government” so as to “stop government from regulating Facebook”.

Famed economist Daron Acemoglu (co-author of the noted book Why Nations Fail) has even suggested that what he calls “the capitalist state” may be prompted, by growing automation and an ever-rising stock of capital, to launch a “coup against democracy” and institute “repression”. He hypothesizes that for quite rational reasons – the desire to maximise profit – “democratic decision-making will become less and less attractive to capitalists”.

The Questionable Allure of Fascism

But a counter-question can be posed. For most corporations – as opposed to some idiosyncratic ultra-wealthy individuals thrown up by this age of mammoth inequality – is backing Fascism is really necessary or even desirable? As alluded to above, Clara Mattei in The Capital Order showed that in the 1920s, both Britain and Italy imposed brutal austerity – in the form of spending cuts, high interest rates and repression of trade unions. But while the latter became Fascist and abolished elections, the former didn’t. In fact, Britain instituted its recession-inducing austerity policies in the same decade that it experienced universal suffrage for the first time.

The Anti-Trump Corporation

It’s also true that for some corporations, elements of the modern Fascist script stick in the craw, primarily because they alienate senior staff members. Disney, for example, perhaps the archetypical American corporation, publicly criticised a Florida law which restricted teaching about sexuality and gender identity in schools, a kind of American version of Thatcher’s Section 28. This was even at the cost of a two-year long legal battle with the Trumpite state governor.

But though it personified corporate opposition, Disney was far from alone. Altogether 337 corporations, including famous names like Apple, Pepsi, Pfizer, Facebook, Mastercard, Citibank and Amazon  signed a statement bemoaning similar state bills across the country that “single out LGBTQ+” people and “have a negative effect on our employees, our customers, our competitiveness, and state and national economies.”

Some American corporations have also retained their DEI policies in the face of threats from the Trump administration. Clearly the ogre of the woke corporation, invoked by the MAGA movement a few years ago, still exists under the surface. It’s a phenomenon that simply didn’t exist the last time Fascism bestrode the world. The late David Graeber brilliantly diagnosed a “culture of resentment” that hones in on a corporate Left elite of HR managers and administrators who police language and acceptable behaviour. “The mainstream Left largely controls the production of humans,” he wrote, “The mainstream Right largely controls the production of things”.

Despite Trump and Elon Musk and crypto-billionaire funded Nigel Farage and Rupert Lowe and Tommy Robinson, this division within the corporate world is very real. But although sections of the corporate elite may passionately hate contemporary Fascism, they are no more predisposed to “democratic decision-making” than the Right. They may be dissenters in the culture war but in the economic war they are resolutely on-message.  In fact, though universal suffrage is an unadorned fact, few powerful people actually like it. As seen by their reaction to losing control of the UK Labour party a decade ago, centrists loathe democracy too.

Be that as it may, in the absence of a serious working-class left-wing revolt, an alliance between the corporate Left and the corporate Right, though they both detest Marxism and view democracy with visceral distaste, seems unlikely.

The surreally limited vision of ‘democracy’ of Margaret Thatcher’s mentor Friedrich Hayek – representatives serving 15-year terms with electors only able to vote for them once in their lifetimes – may be appealing to right-wing libertarians like Peter Thiel but the schisms run too deep for it to become a charter for corporate freedom.

Acemoglu’s “capitalist state” launching a “coup against democracy” presupposes a unity of purpose that was only achieved sporadically in the 1920s and ’30s and would be even harder to cement today. In any case, the dangerous beast of democracy has been suitably tamed in the last few decades by methods such as austerity, debt and the judgement of financial markets. If all else fails, Machiavellian techniques can be employed to see off insurgencies like those of Corbyn or Saunders.

The Shifting Battlefield

Though this last may facilitate the rise of the far right by channelling grievances in that direction, that too has a function for the corporate elite even if these parties do not attain power. The pressure of right-wing opponents promising a bonfire of regulations and more austerity results in establishment parties, even ostensibly ‘left-wing’ ones, committing themselves to similar, though maybe not quite as extreme, policies. Labour Chancellor John Healey, for example, wants further deregulation of the finance sector, accompanied by “fiscal discipline” (read austerity), while the Tories and Reform scream ‘not enough’. Thus, the battle lines are drawn, while the battlefield itself moves inexorably to the Right.

In 1931, American philosopher John Dewey called politics “the shadow cast on society by big business”. Four decades later the Deweyite Noam Chomsky said that corporations were, “in political terms fascist.” Organisationally, there is “tight control at the top and strict obedience has to be established at every level”. The corporation cannot help but shape democracy in its image. At root the problem is corporate power. While it exists, democracy will always be mutilated. It just depends how badly it is mauled.

The Consequences of Slow Growth, part one

 Echoes of the global financial crisis of 2007-9 are in the air. Both the US Nasdaq and the tech-heavy South Korean stock market have fallen heavily recently, prompted by threats by the US Federal Reserve to raise interest rates. Back in February 2007, stocks in the US and Asia also nose-dived, presaging ‘Debtonation Day’ in August of that year.

And the proximate cause of the credit crunch, which many very knowledgeable people assured us could never happen, was an incremental rise in interest rates.

But whether an almighty bubble is about to burst, as it has threatened to many times before, there is one thing we in the West can be sure of. We are living in a society defined by slow economic growth, which qualitatively distinguishes it from economies in most of the second half of the 20^th century.

Statistics can lie but not here because they are so stark. In the decade to 2025, UK GDP grew by just 14%, an annual growth rate of just over 1 per cent. In the decade to 1965, growth was 37%, and economic growth per capita (growth adjusted for population growth) in the last 10 years has actually been negative.

The European Union has seen average growth of 1.3% over the last 19 years and 1.1% in the Eurozone.  This is a decline from nearly 5% in the 1960s, 2.1% from 1973-83, and 1.6% in the 1990s.

The US, the world’s largest economy, has performed slightly better but the trends are still unmistakable. In the 1950s and ‘60s, the growth rate was above 4% before decreasing to around 3% in the 1970s and ‘80s. Over the last ten years, the average has been below 2%.

These are not figures relative to other economies. Other parts of the world, like China, have clearly been catching up over the last few decades. But the West’s growth decline is palpable without comparisons to other countries.

Nor, as an aside, is this what was meant to happen. Thatcher and Reagan’s ‘free market’ economic medicine was sold on the basis on reviving the economy, ushering in an era of prosperity. But as these supply-side prescriptions have bedded down into conventional wisdom, they have had precisely the opposite effect.

 And slow growth has definite consequences. One of these is that ‘democratic’ government (to the extent that our government can ever really be called democratic’) gets absorbed by private economic power. Back in the 1930s, US President Franklin Roosevelt called this “the essence of Fascism”.

I was reading recently a book about “deaths of despair” in the US. These are deaths by suicide, drug overdose, or alcoholism, which the authors contend have shot up among white people without a degree since the turn of the century. There are many possible reasons, which I can’t go into here, but one factor is slowing economic growth.

“What may seem like small differences in growth rates have effects over long periods of time”, the authors, Anne Case and Angus Deaton (not that one), say.

One of these effects is increasingly bitter fights over distribution. “With lower growth, there is more pressure to shut out less successful groups”, they write.  This “poisons politics”.

Such a poisoning can be seen in British politics in the demonisation of immigrants and refugees. Or in the intense concentration on attacking the very limited, and very conditional, benefits of sick and disabled people; an issue which simply didn’t exist prior to the 1990s, in an era marked by higher economic growth. The ‘problem’ of excessive benefits paid to vulnerable people has become an obsession of British politics in the age of austerity.

Case and Deaton also say that with slower growth, the “positive-sum game of innovation” gets usurped by “Rent-seeking”. This turns into a “vicious circle that impoverishes everyone”.

Rent-seeking does not just mean seeking housing rents from tenants, but the appropriation by powerful corporations of the existing income of government and society, rather than attempting to create new sources of wealth.

Based on these insights, the basic features of slow growth society, in Britain and elsewhere, can be identified.

In a slow growth society, living standards decline or stagnate

Wage rates in the US have been stagnating for half a century. In Britain, the process has been more telescoped but no less pronounced. According to the Resolution Foundation, if wages had continued to grow as they had been before the 2008 financial crisis, they would be 37% higher than they actually are.

This has taken place in the context of a decline in real GDP – GDP that takes account of a rise in population. “It is extremely difficult for living standards to rise in such circumstances” says socialist economist Michael Burke. Likewise, Case and Deaton say that in an economy growing at 2.5%, living standards double in 28 years but at 1.5% it takes 47 years.

Of course, in a strongly growing economy, there is no guarantee that income will be shared out. While global GDP has increased by 65% since 1990, for example, the number of people living on less than $5 a day has increased by 370 million.

But in a stagnant economy, there is even less chance of living standards increasing. Why should this be so? Partly this is because living standards are dependent on labour productivity which is in turn dependent on business investment. And both of these metrics have been falling over the last few decades. As Case and Deaton say, “investment is a prerequisite for growth, it embodies the latest knowledge and techniques and it raises productivity.”

In the absence of investment, business tends to concentrate on low-cost labour, possibly overseas, or cheap AI transformations. Neither of which raise living standards.

There is easy money to be made – for some people

But in these circumstances, capital is irresistibly attracted to something else – rent-seeking. This involves making money, not from consumer spending on new products, but from government revenues or unavoidable spending by consumers (on housing or heating costs, for example). Something that is already there and merely has to be tapped or exploited. The deal negotiated by pharmaceutical companies with the Starmer government to double NHS spending on new drugs over the next decade – the cost of which has been variously placed at £64 billion or £44.7 billion, causing hundreds of thousands of excess deaths – is a prime example of rent-seeking.

The “VIP Lane” created by ‘Boris’ Johnson’s Conservative government, to enable firms with political connections to the Tories to get PPE contracts under Covid, is another.

More generally, Britain’s ‘privatised’ utilities – in truth not genuinely privatised but contracted out – are a haven of rent-seeking. They provide both a monopoly ensured by the government and a captive market of consumers who have no choice but to buy the ‘product’ being sold. Unsurprisingly, charges have increased way beyond the rate of inflation.

But rent-seeking can occur in purely private sector settings. When a private equity consortium buys a company, in the process loading it down with debt, and then prepares it for re-sale by asset stripping it and increasing the charges to customers, that is rent-seeking. It is destructive to the viability of the firms that are acquired, but the ‘investors’ acquire massive profits.

These processes come to dominate entire economies. The Tories’ PPE scandal has been described as “the rule of contemporary British capitalism, rather than the exception”, while a recent report by UCL professor Mariana Mazzucato has characterised the European economy as a “capitalism of rent”, where income is captured not by producing anything but by achieving market power, and owning assets and charging for access to them.

It is no accident that this degradation has occurred in an era of slow GDP growth, where the levying of rent becomes a far more lucrative and risk-free strategy than actually creating anything.

In a slow growth economy, everything costs more – for a reason

As the Mazzucato report asserts, the crux of corporate strategies is the achievement of market power, which enables income to flow from charging people or other companies to access what you possess. This brings into focus another aspect of slow growth economies – an increase in price mark-ups.

A price mark-up is overcharging for products. According to orthodox economic theory, the price of goods is determined by the cost of the labour and raw materials it takes to produce them, plus a ‘normal’ rate of profit (as we are talking about a profit-based system).

But under a regime of price mark-ups, this normal level of profit becomes ever more elastic. According to one recent book on the cost-of-living crisis, the largest UK firms have massively raised their mark-ups over the last two decades, from 58% in 2002 to 82% in 2020.

This ability to profiteer, and impose what is essentially a private tax on consumers, is intimately related to size and market power. Research by the anti-monopoly group The Balanced Economy Project, reveals that for the world’s top 20 companies, in the five years to 2022, the average mark-up rose to around 50%. For the bottom half of firms (around 34,000 companies were studied), however, the average mark-up was just 25%.

And for some sectors of the economy – pharma or Big Tech for example – mark-ups can be huge, many hundreds of per cent.

The economist Isabella Weber coined the term “sellers’ inflation”, to account for the inflation that took hold after Covid-19 that, she said, was based on “the ability of firms with market power to hike prices”. In truth this process was happening before the Covid epidemic, but as inflation was so low few noticed.

A decade ago, the Economist magazine found that corporations in the US were raking in “exceptional profits” of $300 billion a year, equivalent to a third of taxed operating profits. Some sectors of the US economy were seeing price rises of double the rate of inflation. This, at a time when inflation was negligible (indeed there was a pervasive fear of deflation). Of course, GDP growth was tiny as well, lower than it had been since before World War Two.

What is interesting is that these price mark-ups were occurring in the most concentrated parts of the American economy. In the same article, the Economist analysed 900 sectors of the US economy and found that 2/3rds had become more concentrated between 1997 and 2012.

Not only do high mark-ups contribute high profits and high market value, they are enabled by it. When it comes to charging much more for your products than it takes to produce them, the bigger you are the better.

Which leads to another insight.

Bigness is a curse

In the late 1930s, Franklin Roosevelt called attention to a “concentration of private power without equal in history”.

0.1% of corporations in America, he told the US Congress in 1938, owned 52% of the assets of all of them. Now that figure has risen to 90%.

Roosevelt said something else in his speech, delivered in the midst of the Great Depression. That the history of modern times “proves that in times of depression concentration of business speeds up. Bigger business then has a larger opportunity to grow still bigger at the expense of smaller competitors who are weakened by financial adversity.”

We are undoubtedly now faced with, and have been for some time, conditions of “financial adversity”.

A slow growth economy means generalized financial adversity — not just among people struggling to make ends meet but among small businesses who are dependent on consumer spending or may be the suppliers of corporate behemoths like Amazon.

One group, though, palpably not suffering from financial adversity are large corporations. Corporate profits are at all-time highs, eclipsing previous all-time highs achieved a few months before.

And the large are getting larger. According to Goldman Sachs, “despite uncertainty in the global economy” mergers and acquisitions – which by definition involve the creation of ever larger economic and financial entities – could hit $3.8 trillion in 2026, surpassing the previous peak in the Covid-year of 2021.

Received wisdom has it that the threat of Fascism is nurtured by conditions of inequality, poverty, anxiety, and a lack of social mobility. Conditions that will call out for scapegoats to be found which temporarily soothe the anxiety.

But if we listen to Roosevelt who was speaking when Nazism was approaching its zenith, that isn’t the whole story. Fascism also has an economic corollary, what he called “a cluster of private collectivisms” … “masking itself as a system of free enterprise” that seeks to control democratic government.

Fascism doesn’t just base itself on the exploitation of popular discontent among its mass base. It also has an elite element, which finds nourishment, as it did in the 1930s, in the conditions of a slow growth society.

What Roosevelt termed the “essence of Fascism” is what I want to consider in the second half of this article.

Memoirs of a 'decent' man

Sir Kier Starmer resigned the way he assumed power in the first place. By revealing a relationship with truth so estranged it would make Josef Stalin blush.

“Six years ago, I inherited a Labour Party that was politically, financially and morally bankrupt,” Starmer told the country outside Downing Street.

It is necessary to deal with each of these claims in turn by virtue of the fact that unless challenged, recent history becomes ossified into a straitjacket of received wisdom that fatally conditions what can be thought possible in the future.

Politically Bankrupt

In 2019, Labour under Corbyn, as Starmer and his acolytes never tired of saying, achieved the party’s worst showing since 1935, winning just 202 seats. Boris Johnson’s Conservatives  won 365 seats, their best performance since Thatcher’s victory coronation of 1987.

Apart from memory-holing the election just two years before in which Labour had somehow secured the largest increase in its vote since 1945, this warped interpretation conveniently ignores how 2019 was uniquely about one issue, Brexit. And Corbyn’s Labour, faced with a core support overwhelming backing Remain and 2/3rds of the actual constituencies it was defending having voted Leave, was trying to pull off the most delicate of balancing acts.

Its 2017 result partly stemmed from a promise to respect the result of the referendum. But this stance was made all but impossible by then shadow Brexit spokesman – Sir Kier Starmer himself – deliberately violating the agreed party policy and telling the 2018 Labour conference that he wanted a second referendum “and nobody is ruling out Remain as an option”. This led to the perception that Labour was a part of a ‘Remain alliance’ and doomed it in the eyes of many voters in ‘Red Wall’ constituencies, and elsewhere.

Starmer also torpedoed cross-party negotiations with the May government in 2018 over getting a Brexit deal through the Commons, even ruling out his own party policy on a customs union. Thus, he ensured that the hardest of all Brexit deals would be the one to succeed.

But as soon as he became Labour leader in 2020, the ‘King of Remainia’ went through a strange metamorphosis and declared that “Britain’s future is outside the EU” and all arguments about the issue belonged to the past. Clearly his previous stance was very principled, though, and not all an amoral strategy to displace Corbyn at all costs.

Notwithstanding Starmer’s antics, the 2019 election would still have been closer had not Nigel Farage’s ‘Brexit Party’ (actually a company, not a political party) chosen not to stand in 317 Conservative-held seats. This had the result of artificially inflating the Conservative vote share and probably their number of seats.

Curiously, the Conservatives, who must have received – according to Starmer’s interpretation – such a resounding mandate in 2019 (in contrast to Corbyn’s Labour), have since shrunk to a rump of 121 seats. Why they have plunged into such an ‘existential crisis’ in such a short space of time is something of a mystery, unless of course the issue of Brexit artificially hid their real popularity just as it artificially magnified Labour’s divisions.

Financially bankrupt

This is especially ridiculous. Labour in 2019 were flush with cash, on the back of surging membership numbers which peaked at 600,000. Starmer’s unique talent was to reverse this process by telling hundreds of thousands of people to leave (“the door is open”), or simply expelling them.

He then partially plugged this gap by suddenly becoming immensely appealing to very rich people (many of whom formerly donated to the Tories) and corporations. For example, Labour’s 2024 election campaign was bankrolled by a huge £4 million donation from hedge fund Quadrature Capital, the largest single donation the party had ever received. But because of when it was received – in the week after Sunak called the election but before the “pre-poll reporting period” – Labour didn’t have to publicly declare it during the campaign. And our fearless media didn’t bother to enlighten anyone.

Morally Bankrupt

Now we come to the crux of Sir Kier’s appeal to posterity. He was a ‘decent’ man, fighting against the odds to rescue the party he loved from the cesspit of antisemitism into which it had fallen under Jeremy Corbyn.

The truth is rather different. Starmer, as the public face of the right-wing ‘Labour Together’ faction, cynically used antisemitism allegations to purge thousands of left-wingers from the party whose only crime was to criticise Israel, a country which would go on to refute these criticisms by committing a genocide in Gaza.

Of course, Sir Kier was on hand to support what was happening, lay on surveillance flights over Gaza, and increase arms sales at the height of the killing.

The Starmer purge extended to Corbyn, forced out of the party for observing, correctly – even mildly – that the extent of antisemitism in the party had been “dramatically overstated” by political opponents and the media.

Under Starmer the totalitarian mentality so gathered pace that even suggesting that Labour wasn’t riddled to the core with antisemites was an offence punishable with expulsion. Victims of this witch hunt included a Jewish professor, hauled up charges of simply repeating a pun by another Jewish member of the Labour party (Jo Bird’s ‘Jew process’) and an elderly Jewish woman accused of, among other things, “demonising Israel by inaccurately [sic] describing it as an apartheid state”.

There is a definite ‘pattern of behaviour’ here. In fact, as leader, Starmer expelled more Jews from the Labour party than all previous Labour leaders combined. As Andrew Feinstein (Starmer’s opponent in Holborn & St Pancras in 2024) pointed out, that is like expelling people of colour to combat racism.

In truth, the one decent thing that Sir Kier Starmer did was resign. Everything else was appalling.

Starmer’s handmaidens

But it would be wrong to see Starmer’s momentary ascendancy as being solely down to the man himself, once generously described as “a piece of hotel art made man”. Nor was his brief reign merely the responsibility of his sponsors in the shadowy Labour Together group, likened in their amorality to the denizens of Richard Nixon’s White House.

There had to be other powerful forces behind the strange phenomenon of Sir Kier Starmer and there were – the British media and important parts of the British state.

At every stage of his political career, the media had Starmer’s back, because, in essence, he had a job to – to destroy Corbynism at its roots. For example, every national media organisation (barring the Morning Star) enthusiastically backed Starmer’s decision to suspend Corbyn from the Parliamentary Labour party for his response to the Equality and Human Rights Commission report.

The EHRC report was itself a sham, though. It deliberately refused to hear evidence contradicting its interpretation, erroneously described those guilty of ‘antisemitism’ as being ‘agents’ of the party, and accused the Corbyn leadership of acting unlawfully by riding roughshod over ‘established procedures’ to intervene in individual cases, when the party’s rule book explicitly allowed it to.

When the circumstances cried out for investigative journalism, all you got was consecration. And a herd of braying donkeys.

Conversely, when Starmer did subsequently furiously intervene in antisemitism cases to expel the (left-wing) perpetrators forthwith – something the EHRC (wrongly) said the Labour leadership was not allowed to do – there was complete media silence.

And when Starmer jerked Labour massively to the Right, after being elected as Labour leader by promising to continue with Corbyn’s policies, the media response was largely to commend him for practising clever politics.

Sometimes the cognitive dissonance was breathtaking. One of Starmer’s pledges  to members when he was campaigning to be elected Labour leader was to “end the Tories’ cruel sanctions regime”. In reality when he got into government, not only did he fail to do this, he actually made it worse, increasing sanctions to their highest ever level in January 2026. According to an Amnesty spokesperson, “I’ve worked to highlight human rights violations for more than two decades and witnessed many awful situations. But never have I encountered such raw and widespread distress from people sharing their experiences in the UK.”

But, to the British media, this world, which affects millions of people, simply doesn’t exist.

And the media omertà about Starmer spread its tattered net far wider. The successful campaign by Starmer backers Labour Together to hamstring left-wing media organisations like The Canary after 2017 by getting advertisers to withdraw on the laughable basis of not supporting ‘fake news’ happened, at the time, completely in the shadows. Anti-Corbyn Labour bureaucrats’ scheme to funnel money to right-wing MPs in 2017 at the expense of the official campaign barely registered. And Starmer’s predilection for money and freebies from high-net-worth individuals and corporations to fill the financial void left by members deserting in droves was, almost without exception, left to the alternative media, who had a far smaller reach, to expose.

The 40-watt searchlights of the mainstream media continued their feeble glare after 2024. Starmer Labour’s 2025 deal with pharmaceutical corporations, which will double the amount the NHS pays for drugs, trampled all over the independence of NICE, the body that decides whether drugs are cost-effective and should be paid for by the NHS. But the deal was presented in entirely vanilla terms by the media, thus concealing what it was really about.

Our strange form of democracy – really oligarchy accompanied by ratification by universal suffrage – has left us in a paradoxical situation. Powerful and wealthy vested interests decide who can, and cannot, have political power (not Corbyn for example) but voters then cast their judgement on them. The result has been seven Prime Ministers in the last decade.

The fact that no-one of influence can see the problem is why they inflicted Sir Kier on us and expected it to work.

'Labour', lobbying and the de-corporatization of society

The ‘Labour’ party are a bunch of corporate lobbyists with a political party attached. And that includes its white knight, Andy Burnham.

Just before Labour won the 2024 election, Rachel Reeves reassured an invited audience of leading corporate representatives that “your fingerprints are all over every one of our national missions”.

She wasn’t exaggerating.

One of those fingerprints belongs to the “Prince of Darkness” Peter Mandelson, now charged with “misconduct in public office” stemming from his best buddy relationship with sex offender, Jeffrey Epstein. In 2010 he co-founded the now defunct lobbying firm Global Counsel. The aim was to exploit his seminal place in the modern Labour party and help corporations “see opportunities in politics, regulation and public policy”.

A Freedom of Information request from journalist Solomon Hughes reveals that Global Counsel was still hosting soirees and breakfasts for its business clients and representatives of the UK government less than a year ago.

Attendees on the lookout for “opportunities” included financial services behemoth JP Morgan and drugs giant GSK (formerly GlaxoSmithKline). Among the subjects discussed was NHS drug pricing.

Curiously, a few months later – in December 2025 – the government announced a deal with the US over how much the NHS pays for pharmaceuticals (bought mainly, though not exclusively, from American corporations). The agreement – intended to avert the axe of Donald Trump’s sanctions – saw the NHS committed to paying 25% more for new medicines and to increase what it shells out for existing drugs.

Under its terms, the NHS is also compelled to double its spending on new medicines from 0.3% to 0.6% of GDP by 2035.

It is estimated the cost will come to £64 billion.

Inevitably, given the government’s “iron-clad” commitment to fiscal rules, the money will be diverted from patient care. According to one health economist – Karl Claxton who led a research term at York University to model potential outcomes – by 2033 excess deaths as a result of the deal will be greater than in the first two years of Covid.

“The government faced a clear choice,” Claxton said, “either back the NHS and adult social care and stand up to these pressures, or don’t. And it decided not to.”

In another strange coincidence, in November 2025, JP Morgan announced plans to build a skyscraper new HQ in Canary Wharf. The decision owed a lot to the deal, negotiated by the Treasury and Tower Hamlets council, to provide the bank (which is clearly short of cash) with a 100% discount on business rates.

Also oiling the wheels was Rachel Reeves’s commitment not to increase taxes on banks in her autumn budget (just on everyone else) following a meeting in Number 11 with Goldman Sachs.

It wasn’t thought necessary to call in a police forensic team to sweep the room for fingerprints.

The lobbying impulse is so deeply ingrained in the ‘Labour’ party that glaring conflicts of interest pass without a second look. Mandelson was UK Ambassador to the US during the NHS drug pricing negotiations. All through this time, he remained president of Global Counsel which represented GSK and JP Morgan. His firm actually undertook research for the Association of the British Pharmaceutical Industry “making the case for many of the changes ultimately secured in the deal”.

According to a whistleblower, Mandelson vetted Labour candidates for the 2024 General Election. Just to make doubly sure no unsavoury characters slipped through the net.

Doubtless the memory of Jeremy Corbyn gave him the jitters but he needn’t have been so careful. Research before the election was called revealed that 10% of confirmed Labour candidates were employed as corporate lobbyists and communication advisors. And according to an article in The Times, a third of actually elected Labour MPs have a background in lobbying. “It was”, said the author, “the most common past job for an MP – far outstripping trade unions, teachers or doctors”.

And if they manage to climb a few rungs up the greasy pole, they are sure to run into former colleagues. Secondees from lobbying firms work with senior Labour ministers such as Rachel Reeves and Jonathan Reynolds. Mandelson’s Global Counsel spent £36,000 paying for a staff member to work with former Treasury minister Tulip Siddiq for a year.

When the former Scottish Labour leader, Jim Murphy, (the electoral mastermind oversaw Labour haemorrhaging 40 seats in Scotland in the 2015 GE), predicted that Starmer’s government would be “the first private sector government in Labour history”, he was, if you’ll excuse the pun, right on the money.

Of course, Manchester Mayor Andy Burnham wants to return to Parliament, oust Sir Kier, and “change” Labour (a word you may have heard somewhere before).

The fact that the lying/snooping Labour Together faction that put Starmer in power in the first place are the very people that are beating out the path for Burnham to return to Parliament should invoke a healthy degree of scepticism.

Burnham has already rowed back on his lament that Britain is “in hock to the bond markets”, promising to stick to Reeves’s fiscal rules and replacing rhetoric about renationalising utilities with merely instituting ‘stronger public control’.

But even if Burnham was sincere in wanting to send the lobbyists scuttling away from the husk that remains of the ‘Labour’ party, it would take a lot more than the good vibes he is promising to do it – for Labour not to roll over but, in the words of Karl Claxton, “stand up to these pressures”.

The huge increase in the amount to be paid by the NHS for branded drugs agreed to by Labour was not merely the fruit-bearing result of a concerted campaign by bands of lobbyists. It was also preceded by real-world threats to withdraw investment by pharma companies (interestingly, that weren’t all American and thus backed by Trump). What, in old-fashioned language, used to be called a ‘capital strike’. In the words of a Bureau of Investigative Journalism report:

Then, over the course of a single week in September, the dominoes began to fall. One company after another threatened to pull major UK projects: MSD scrapped a £1bn London research centre; AstraZeneca paused a £200m project in Cambridge; Eli Lilly parked a planned London lab. In response to concerns that the pharma giants had colluded in a bid to bump up drug prices, the Competition and Markets Authority said it had decided not to investigate.

A fortnight later, AstraZeneca threatened to quit the London Stock Exchange and move to the US.

In a similar vein, JP Morgan – in spite of the 100% business rates relief sweetener and the promise of no new taxes on banks – has threatened to back track on the building of its new HQ if Sir Kier is replaced by someone “hostile to banks”.

Even if the government were full of – to use Tony Blair’s phrase from 1997 – “whiter than white” individuals with impeccably sturdy backbones, they would, in all certainty, cave in to these demands, followed by an immediate impulse to reach for the shelf containing ready-made excuses about economic growth and saving jobs.

Unless they had an alternative economic strategy to hand.

The only way not to give in to this blackmail is to follow the logic (if not necessarily the publicly announced policies) of Corbynism. To set up a publicly owned drug research and production enterprise to sell at cost to the NHS, thus saving billions for patient care.

More broadly, the entire NHS needs to be renationalised and freed from incremental privatisation.

But it doesn’t end there. Profit maximising banks who, despite the events of 2008, push for renewed deregulation and new ways to be subsidised by the public need to feel the stiff breeze of competition from a publicly-owned investment and retail bank.

And the only real answer to tax havens – likened by the writer Thomas Frank to an “unseen planet” pulling politics and economics inexorably rightwards – is the withdrawal of limited liability which is granted by the state. Without the state, whom corporations incessantly lobby, they are nothing. It is their hidden Achilles’ heel.

The only way to make such a threat credible is to create publicly owned, cooperatively-run companies that can compete with shareholder-driven corporate leviathans and take their place should the latter’s legal ‘person-hood’ be rescinded. Such companies will openly and willingly pay their taxes and won’t try to financially exploit the local or central state or hollow it out through privatisation.

The fork in the road we are now facing is between shades of corporate fascism, based on deportation of immigrants, the crushing of dissent, endless deregulation, and minimal taxes for the super-rich, and something else. That something else is socialism, which will eventually dawn on people who would never think of themselves as socialists.

The If Only Theory of Contemporary Capitalism

 

According to the International Energy Agency (IEA), the closure of the Strait of Hormuz has precipitated “the largest oil supply disruption in history”, eclipsing the oil shocks of the 1970s in severity.

We are like the characters in the film On the Beach (about Australians waiting for the radiation from a nuclear war to reach them), biding our time before the effects seep through. Clearly, not only industries that directly consume oil will be affected. As fertilizers rely on natural gas for their production, decimated crop yields and ensuing food shortages – in addition to flight cancellations and severe inflation – will become the norm.

Bankers JP Morgan predict global oil inventories will hit “Operation Floor” – when oil production stops functioning – in September.

Already faced with 1970s-style stagflation (weak GDP growth and inflation), economies will soon have to deal with slumpflation (falling growth and inflation) says economist Michael Roberts.

This will happen regardless of whether there is a “final agreement” with Iran.

But doom-laden concentration on the inevitable effects of war clouds our judgement. It leads to the feeling that if only these random geopolitical shocks didn’t happen, everything would be fine.

But maybe, rather than being the root cause of crisis, a ‘shock’ like the closure of the Strait of Hormuz is merely exposing fault-lines that were already there.

And maybe there’s a mutually reinforcing dynamic at work. In that the weakness of the economic system generates geopolitical responses which have the effect of further enervating the economy.

Looking again at the oil shock of October 1973 – up until the halting of shipping in the Strait of Hormuz, the worst disruption of the global oil industry in history according to the IEA – is instructive. This older shock involved an oil embargo on countries like the US and UK and a fourfold increase in the price of oil.

Unquestionably this ‘triggered’ a financial crisis and a recession in 1974-75, the first year-on-year fall in output in the West since the Second World War.

But if the problem was merely external (a large increase in the price of oil) once it abated, things should have returned to ‘normal’ i.e. steadily increasing growth and prosperity. But that’s not what happened.

According to historian David Gibbs, the crisis resulted decades’ long flat productivity growth in the US and impaired economic performance in most of the rest of the world

“If you look at long-term rates of GDP,” he says, “it was quite high up until 1973 and in 1973 you see a big drop. And rates of economic performance have never fully recovered from the earlier period.”

It was “a historic break point”.

The same illusion of the primacy of the external cause can be seen in attitudes towards the Global Financial Crisis of 2008. The crisis was caused, so goes the official story, by reckless bank lending leading to a seizing up of credit that the rest of the economy relies on. Now those causes no longer apply, businesses can get credit and the big banks, largely thanks to huge doses of Quantitative Easing, are no longer insolvent.

But if you look at UK economic growth in the pre- and post-crisis period, it is clearly debilitated, less than half as strong. In the 18 years since the 2008 crisis, the economy has grown by 22% compared to 53% growth in the 18 years before it.

Why should this be? Why, once the causes of the crisis are dealt with, should the crisis linger on, not in full-on crisis mode but in enfeebled performance?

Possibly because there was far more to the crisis than revealed by its surface ‘causes’.

To take medical analogy, if a person survives a heart attack but goes on to suffer worsening heart failure – not being able to walk far with running out of breath – the underlying problem should obviously be put down to heart disease, not sought in the particular circumstances that brought on the original heart attack.

But we do precisely this with the economy, continually, as economist Harry Shutt once said, mistaking symptoms for causes.

The former head of Goldman Sachs says he can “smell” a new financial crisis in the offing. This won’t happen, 2008-style, through the banks but in the burgeoning private credit industry where companies, such as private equity firms, lend to other companies.

If it does erupt, what will provoke this crisis will be a rise in interest rates to try and tamp down the inflation caused by the closure of the Strait of Hormuz.

According to chief economist of the World Bank, “the war is hitting the global economy in cumulative waves: first through higher energy prices, then higher food prices, and finally, higher inflation, which will push up interest rates and make debt even more expensive.”

But the external cause won’t explain the crisis. To do that we first need to explain why the global economy in the 21^st century is so much more dependent on trade (i.e. globalised) than it was 50 years ago. Trade now represents about 60% of world GDP compared to 25% in 1970.

Then we need to consider the fact that the economy is much more deregulated than last time, a process which is ongoing. Finally, we need to factor in that the economy runs on huge levels of corporate and personal debt, which makes it so much more susceptible to any increase in the cost of debt (i.e. through higher interest rates).

And these causes are in turn related to the ending, caused by the oil shock of October 1973, of the “thirty glorious years” of strong economic performance after World War Two, and why that turned out to be a “historic break point”.

You cannot understand external shocks like the interruption of the ‘life-blood’ of oil supplies without also understanding how, internally, we are more vulnerable to their effects.