As it continues to maintain the pretence that it is an educational charity, and not just another of those Astroturf lobby groups peddling right-wing propaganda, the Institute of Economic Affairs has once again put the ball in its own net as it brings forth an article that has an educational value not unadjacent to zero. Titled “Are capitalists afraid of socialist success?” and is authored by Kristian Niemietz, IEA Head of Political Economy.
Here, he sniggers “even at its peak, Venezuelamania was always very much confined to Guardian-reading types. Venezuela was never a topic of pub conversations (unless you count the university’s in-house student bar as one). So the idea that factory workers in Sunderland would down their tools and start a revolt, because some place in Latin America (or wherever) has some success in some areas, is, to put it mildly, fanciful”. Tee hee hee!
One can almost hear his fellow IEA inmates simpering in agreement. But this picture of the world bears little relation to reality. As any fule kno, no large and successful economy is purely capitalist, and none purely socialist. Niemietz begins from a false premise; not even the USA does without a modicum of socialism. How, otherwise, would the Freeway Program have been undertaken? Or Amtrak come into being? Or the US postal service?
Did capitalism provide for the provision of money as a reliable means of exchange? Or the lender of last resort that is the Federal Reserve? Capitalism enabled by social programmes; the same the world over. Who runs the New York City Subway, and similar operations throughout the USA? So it is in London, where the Underground system was brought into public ownership in 1933 by a Conservative-dominated Government.
Niemietz talks of other European countries having “market based” healthcare systems, but misses the point: the NHS has been subjected to an amount of marketisation, but remains free at the point of delivery. He does not mention the NHS, as the IEA favours its abolition. It must therefore be A Very Bad Thing. So he exhorts us to “look over there” instead.
Did capitalism give Great Britain a national electricity grid? Sadly not. Nor, until London City Airport, which was built only after significant public subsidy - so the IEA should disapprove - did capitalism give us one major airport in the UK. Not one. All others have been the result of Government intervention, or they have origins as military facilities.
How many major roads in the UK did capitalism provide? Apart from the M6 Toll, and a number of river crossings, that cupboard is bare. Where was the market, which in the lexicon of the IEA and other inhabitants of like-minded Alphabet Soup will always provide? It wasn’t: our roads and, later on, motorway network had to be organised and funded by yet more of that Government intervention - more of that apparently failed socialism.
And who would have supported the UK’s rail network after World War 2, as the “Big Four” operators went, one by one, to the wall, if not the Government of the day, and indeed successive Governments to this day? Yet for our economy to function without all, or indeed any, of these examples is unthinkable. So Niemietz ignores them altogether.
Instead, he sits and sniggers “Venezuela tee hee hee”. Thus the lofty intellectual heights of IEA debate.
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