'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 magic wand and biological determinism. The two faces of neoliberalism

According to Belgian psychologist Paul Verhaeghe, the psychiatric world is riven by two warring factions. On the one side there is the medical or illness model, which assumes that all mental illness stems from biological or genetic defects. Think of low serotonin levels ‘causing’ depression. Treatment involves taking pills, often indefinitely, to relieve the symptoms. Mental disorders are frequently viewed as lifelong afflictions a person must adjust to. The medical model is the dominant approach, adhered to by the majority of clinicians and doctors.

On the opposite terrain is what is known as the ‘biopsychosocial’ model. Under this way of thinking biology or genetics is relegated to a secondary position. Diagnosis focuses on the broader social context facing the individual and treatment is tailored to a person’s circumstances. This model is also far more open to a person making a recovery from mental illness.

Verhaeghe is resolutely on the minority side of the argument. “The vast majority of mental disorders are not illnesses,” he asserts, “but biopsychosocial manifestations in individuals of broader social problems.”

I believe the biopsychosocial model is essential to understanding how our capitalist, neoliberal society is at the root of many mental and physical illnesses. There is overwhelming evidence of the crucial role factors like childhood poverty, inequality, economic insecurity, loneliness, migration and bullying in increasing the risk of mental illness. According to one UK psychology professor, Richard Bentall, the link between childhood trauma and future psychiatric problems is a strong as that between smoking and lung cancer. In contrast, the medical model of mental illness just presents a closed mind.

But the biopsychosocial model also has a sinister side. It is being used to bully disabled people out of social security benefits by insisting they can make miraculous recoveries from their conditions. Disability, here, is regarded as partially caused by the attitude of the sick or disabled person. Welcome to the world-view of ‘welfare reform’ in the UK.

In defending the government’s transformation of the Disability Living Allowance into Personal Independence Payments, Conservative minister Lord Freud (the same one who believes food banks have mushroomed because they offer a free good) told the House of Lords that ‘we have gone for the biopsychosocial model’.

According to a report from the Centre for Welfare Reform, “the biopsychosocial model has been used to create new obligations for those suffering from common health problems, such as the responsibility to ‘recognise that the sick role is temporary, in the expectation of recovery’”.

In one case, the Department for Work & Pensions funded a medical trial for people with ME which was presented as an exciting success for biopsychosocial intervention. But the standard for ‘recovery’ was lowered after the research began meaning that a person’s condition could have worsened and they were still counted as having ‘recovered’.

Here is 'Biopsychosocial Man' in action: 

The DWP has incrementally re-classified the work related activity group of Employment and Support Allowance claimants (people judged unfit for work) as not really disabled. Before, the government only asserted that people in the WRAG group might be able to work at some point in the future and that full-time work could damage their health. Now, they are subject to a ‘shocking’ level of sanctions and, for new claimants, paid the same in benefits as ordinary JSA claimants, as an incentive, ministers say, to find work.

At the same time the government is trying to re-package unemployment as a personal failing or mental illness, as opposed to a social problem beyond the power of the individual to rectify. There are now psychologists in job centres and job coaches in GP surgeries.

This indicates a fatal flaw in the biopsychosocial model. When it applied to the individual alone and their ‘wrong attitudes’, it becomes coercive, tyrannical and vindictive. Applied to society at large, it is liberating.

Under neoliberalism, an unsuccessful person is either lazy or sick. If they are sick, they need pharmaceutical assistance (which creates a steady stream of profits for pharmaceutical companies). If they are lazy, their misguided attitudes need to be corrected by enlightened experts. Two sides of the same battered coin, which, sadly, is still legal tender. The social and economic organisation of society is taken as a given, and not worthy of consideration.

The medical model strikes me as a dead end, like trying to argue with someone who has their fingers lodged firmly in their ears. But the biopsychosocial model can be both oppressive and illuminating. Perhaps we need to drop the ‘psycho’. A biosocial model of illness has great explanatory power and it can’t be manipulated to scapegoat people and cloak the interests of the powerful.

The ethical rot at the heart of capitalism

The list of crimes of which the pharmaceutical industry is accused is legion. According to a professor at Copenhagen University, prescription drugs are now, behind heart disease and cancer, the third most common cause of death in the West and estimated to be responsible for half a million deaths a year in the over 65s. The editor of the UK’s Lancet magazine, Richard Horton, contends that maybe half of all scientific research is simply untrue, “afflicted by small sample sizes, tiny effects, invalid exploratory analyses and flagrant conflicts of interest”. In 2012, two French researchers claimed that half of all drugs prescribed in that country were either useless or dangerous and responsible for 20,000 deaths annually.

There is an obvious connection between these outcomes and the character of the pharmaceutical industry – capitalist corporations duty bound to maximise short-term profit for their shareholders. Even western governments, in unguarded moments, agree. A 2003 report for the UK’s Treasury (finance department) conceded that the pitfalls of a market in healthcare were overtreatment and the abuse of monopoly power. But then pressed ahead anyway.

But that connection, clear to any reasonably honest person, is not what stands out here. What is most interesting is how this profit maximising model has so thoroughly infected the apparatus of regulation. Horton blames individual scientists who too often “sculpt data to fit their preferred theory of the world”, medical journals aiding and abetting the “worst behaviours” and universities engaged in a “perpetual struggle for money” and “high-impact publication”.

What’s clear is how far these institutions are from providing, in the writer Ben Goldacre’s words, “a competent regime of regulation”. There is a deep ethical rot at work, seeping outwards into society’s foundations. What’s more the ethical rot is essential for capitalism to function effectively.

Financial dis-regulation

Consider finance. Seven years after a monumental financial crash, triggered by ordinary people defaulting on mortgage payments, sub-prime mortgages have made a comeback in the UK, an event unencumbered by government regulation. Regulations drafted after 2012’s Libor rigging scandal have been watered down. The bank levy, intended as recompense for the financial crisis and bail-out, has been reduced (as an incentive, many think, to keep HSBC headquartered in Britain), a ‘penalty’, in any case, more than compensated by the huge 38% drop in corporate income tax, from 28% to 18% since 2010.

The EU, in the TTIP negotiations, is pushing for the US to adopt weaker financial regulations (on derivatives) than it has at present. And as part of the separate ‘Trade in Services Agreement’ between the US, Europe, Japan and Australia, it is proposed to make it mandatory that countries accept “any new financial service”.

Government regulation is giving way on many fronts to voluntary agreements, in the UK and EU, which have been proven to fail.

It is tempting, and probably correct, to blame intense and unrelenting lobbying by corporations for these outcomes. Most politicians are members of the 1% or 0.1% and may have a direct financial interest in the successful expedition of these policies. And they may not even know of the effect of the policies they so adamantly pursue.

But I believe the deliberate feebleness of regulation has a deeper cause than ‘regulatory capture’ or ideological blindness. It stems from a recognition that economic growth now depends on facilitating avowedly anti-social practices. Aside from the pharmaceutical and finance industries, consider the way the food processing industry works. Huge amounts of sugar are routinely and covertly added to a range of products, not just the openly sugary fizzy drinks, and have caused an epidemic of Type 2 Diabetes. The publicly funded NHS is obliged to treat this scourge which consumes a tenth of its budget. Yet, the UK government sets its face against regulation, preferring a toothless ‘responsibility deal’.

The extractive industries, oil, gas and coal, rely on taking fossil fuels out of the ground, in increasingly dangerous places, a practice which will inevitably take the world into the realms of civilisation-devouring global warming.

Mrs state-mop

The role of the state now is merely to mop up, whether in the form of bank bail-outs, NHS spending or flood defences, the detritus caused by these anti-social practices. Because, at root, the economic and political elite cannot imagine another form of economic growth.

The Angry Person’s Guide to Finance, a pamphlet published by the UK’s Red Pepper magazine in 2014, contends that a “serious regime of strict financial regulation” could outlaw securitised debt, derivatives, the shadow banking system and the whole shebang of ‘financial weapons of mass destruction’. But at the cost of plunging the world economy into a deep depression, as companies fold like dominoes. Similarly, stringent regulations for the production and marketing of prescription drugs would proscribe many of the products relied on by pharmaceutical companies for their profit stream. At a time when these companies already provoke grumbling from their shareholders for not being profitable enough investments, this would be absolutely lethal.

The urgent question, therefore, is whether there is another form of growth that can safeguard the public interest and not degenerate into flagrantly anti-social forms of profiteering. An answer is taking shape in the proposed policies of Labour party leader Jeremy Corbyn. A mix of part-nationalisation, regulation, and public investment, can invigorate economic growth and substitute for anti-social private sector growth. Because private investment is so weak, public investment, through the state (or as Corbyn proposes a National Investment Bank) can direct economic growth to more benign ends, such as investing in renewable energy or retro-fitting houses, than the ‘instant gratification’ approach that the corporate sector relies on when left to its own devices.

However, what this policy alternative leaves in doubt is whether it can replace or merely augment socially harmful private sector growth. The economist Harry Shutt says the western world has been afflicted by a ‘glut of capital’ for four decades. With a decline in the demand for fixed, or productive investment, mainly because of technological progress, the economy has to find increasingly speculative or harmful outlets for profitable investment. This ‘wall of money’, added to by the growth of private, stock market invested pension schemes, is inevitably funneled into speculative or useless (copycat prescription drugs) investment, because sufficient productive outlets do not exist.

In 2013 the UK Parliamentary Commission on Banking Standards concluded that institutional shareholders, such as pension funds and hedge funds, were incentivised to encourage the banks they invested in to pursue ‘high risk strategies’ and, in the run-up to the financial crisis, some were actually criticising banks for ‘excessive conservatism’. In other words, the problem of growth harmful to the public interest is systemic and not the handiwork of greedy or reckless bankers.

Liable for your sins

What this means is that any economic strategy based on public investment has to contend with this ‘actual existing capitalism’ and, as I have argued before, probably cannot pull the plug on it without precipitating an economic meltdown. It is also why Harry Shutt and others argue that more drastic action is required to get to the root of a capitalism hostile to the public interest. Shutt proposes restrictions on limited liability; the right, first introduced in Britain in the 1850s, that shareholders in corporations are only legally responsible to the extent of their monetary investment, and that if misdeeds happen, only the company, never its shareholder owners, can be sued. Limited liability should only be granted, in Shutt’s opinion, if a company agrees to a public veto on board decisions concerning major investments, employee pay and pricing.

To return to the Lancet’s Richard Horton. I believe the ethical corrosion he talks about - the scientists sculpting the data to fit the theory, the medical journals giving the green light to dubious drug trials, and the universities engaged in a perpetual struggle for money - has an ultimate cause; the shareholder-based corporate model of capitalism currently ensconced in power and which we regard as untouchable. And any attempt to reverse this moral decay has to contend with the ultimate cause.