Britain’s Elites can no longer control our politics

Podemos-European-ParliamentBritain’s Elites can no longer control our politics: The European Vote will change Britain and Scotland Forever. The European referendum is a milestone for Scotland and the UK.

It is impossible to understate the historic times we are witnessing – a British establishment and political elite no longer in command of politics and affairs of the state in a way they are used to. The Economist this week, well known for its advocacy of economic liberalism and the maintenance of the union of the UK, acknowledged that this vote was ‘not only the most crucial event in this Parliament but the most important in Europe in years’ (February 27th 2016).

What such mainstream accounts don’t say is that the nature of the UK, its component parts, how it does politics, and limited, truncated form of democracy, is being radically altered, and will be further changed by the Euro vote, in ways far reaching and in many respects unintended. Below are an exploration of some of the many ways this will happen at a British and Scottish level over the course of the campaign, the possible result and aftermath.

FOUR NATION POLITICS:
1. The end of British politics will be confirmed. The 2015 UK election was the least British on record. The EU referendum will show four very different versions of politics across the four nations of the UK.
2. This will be a very different pattern than 1975 – when England was the most pro-European (68.7% Stay) and Scotland the least (58.4% Stay).
3. Today Scotland will be the most pro-European (62:38 for Stay in YouGov) and England the most Eurosceptic (all three English regions apart from London for Exit on the most recent YouGov poll).
4. Euroscepticism isn’t just an English phenomenon. It isn’t even uniform across England, London being more immune than elsewhere (54:46 for Stay in YouGov), while Wales is also fertile territory for the Eurosceptics (55:45 for Leave on an earlier YouGov poll).

THE POLITICS OF LEAVING:
5. If the UK votes to leave, don’t rule out the prospect of a second referendum. This has been raised several times by Boris Johnson; and Cameron, aided by the French and Belgians, has stressed that is ‘the final word’ to try to diminish such an argument. This shows an element of panic by the Stay In camp which they never displayed until the last week of the indyref. Germane to this, Europe has established a pattern of arranging re-votes when it doesn’t like the result: Denmark and then Ireland twice. It could just happen.
6. If the UK votes to leave this will provide ‘material change’ for a second Scottish indyref. It would encourage a truncated timetable towards a vote – which would necessitate a rapid need to rethink the Scottish Government’s 2013 prospectus for independence – none of which is currently ongoing. It wouldn’t be simple and it would be messy, but fundamentally the nature of the union that is the UK and which Scots voted for in 2014 would have been radically altered and undermined.

THE POLITICS OF STAYING:
7. If the UK votes to stay in, it doesn’t necessarily decide once and for all the debate. It is 41 years since the last Euro vote; 18 years between Scottish devo votes; and could be a couple of years between indyrefs. Political change is coming around faster and faster. As in the indyref, the forces of change could win the argument and set the future agenda with a respectable 45%ish vote.
8. If the UK votes to stay the Conservative Party will within a few years in all likelihood become formally a Eurosceptic party pledged either to withdrawal or reducing membership to associate status. This vote doesn’t stop the Tories ‘banging on about Europe’ if the UK votes to stay.
9. A precedent for the Tories is what happened to Labour after the 1975 referendum – which occurred because of party divisions and influence of Labour Eurosceptics. Within five years, Labour was committed to withdrawal from the EU and went into the 1983 election with a manifesto pledge to withdraw without a referendum. Only electoral humiliation that year brought Labour back to Euro sanity. Potentially the Euro fringes await the Tories.
10. While Scotland could be dragged out of the EU by English votes – the opposite nationally is just possible. England could be kept in by a Scottish over-ride. It is much less likely as Scotland is a nation of five million in a union of 64 million, but a 58% Scotland stay vote could overturn an English narrow vote for exit.

UKIP AND SNP:
11. UKIP could be beneficiaries from the referendum, irrespective of the result. They are going to have four months publicly discussing their favourite subject, lots of press attention, and occasionally being taken seriously. There is the prospect of UKIP having a mini-SNP indyref effect, and they could poll respectably in the forthcoming Welsh elections, and even have a chance for representation in the Scottish Parliament, based on the high profile of the next four months.
12. Lazy comparisons between UKIP and the SNP will be shown as such. The differences between the two will be on full display in the referendum. For all the shortcomings in the SNP’s independence offer, the party conducted its campaign in an impressive and professional manner, with a focused, disciplined campaign which drew widespread plaudits. The referendum is the moment that UKIP have prayed for, and yet there is the likelihood that the Leave campaign will not be defined by the above characteristics. The SNP is a party of government and aspires to be one of statehood; UKIP is a party of protest.
13. Boris Johnson will have his public profile raised even more by the campaign. He will be the leading Tory Eurosceptic figure, and even if the vote is lost, he will have the prospect of being the candidate of this strand of the party in a forthcoming leadership election. Similarly to the SNP, and Alex Salmond and Nicola Sturgeon, a honourable defeat in the 45% range, would enhance Johnson. However, an emphatic rebuttal of the Exit case could harm him and his prospects.

THE BIG ISSUES: SOVEREIGNTY, BRITAIN’S PLACE IN THE WORLD AND AFTER EMPIRE
14. The key issues of this campaign will be the economy, immigration and Britain’s influence in the world. A fourth strand will be competing interpretations of sovereignty. The Exiters will emphasise an absolute reading of sovereignty, an all or nothing approach. Cameron has tried to have his cake and eat it, citing ‘the illusion of sovereignty’ of Exiting, while reifying parliamentary sovereignty. All of this is smoke and mirrors, and doesn’t acknowledge the increasing practice of shared and pooled sovereignty (a bit like the ‘idea’ of the UK) which is increasingly national and international practice.
15. An alternative ‘sovereignty’ tradition is ‘the sovereignty of the people’ argument found in Scotland (and in the US and French revolutions). This is a mixture of myth and truism: on the one hand, sovereignty of the people is an abstract which doesn’t inform the political and public policy choices of Scotland; yet, popular sovereignty as an illusive concept is not only modern folklore north of the border, but has replaced as popular mood, public opinion and attitudes towards Westminster and most modern politics across the West.
16. There will be a whiff of Great British powerism in the referendum from all sides. This will be expressed even by nominally intelligent people. One example was Jeremy Cliffe, The Economist’s ‘Bagehot’ columnist who recently claimed that ‘The EU is Britain’s to run, if only it could overcome its insecurity about scary foreign bullies’ (February 21st 2016).
17. There is a degree of British exceptionalism in all this thinking that we are in completely uncharted waters. There have in fact been three Exits from the EU: one nation-state and two territories: Algeria 1962 (which was a member due to the French Union which meant it wasn’t notionally a colony), Greenland 1985 (after a narrow Exit victory referendum) and the French overseas territory of Saint Barthelemy which left as recently as 2012. The UK debate is about an Exit of the first member state.
18. Finally, welcome to the future. More referendums. When the first votes took place: the 1973 Northern Ireland ‘border’ poll and 1975 poll, all sorts of political and constitutional experts got huffy and called such things ‘unBritish’ and the sort of thing dictatorships do. Now there have been eleven national and sub-national votes (3 UK, 3 Scottish, 3 Welsh, 2 Northern Ireland). This is the politics of popular sovereignty and will be more likely, rather less likely in the future.

There will be a lot of over the top rhetoric these coming four months. Expect to hear a lot about the UK as ‘the fifth richest economy in the world’ – and then the same politicians turn around and in the next sentence argue that the UK cannot afford a decent welfare state, benefits or pensions.

The legacy of Empire and imperial arrogance will be on full show. This week, former Tory Chancellor Nigel Lawson commented that he hoped a Brexit would lead to the Republic of Ireland realising it had ‘made a mistake’ and ‘come back within the United Kingdom’ (newstalk.com, February 25th 2016). Tory Outer and future leadership candidate Boris Johnson posed that a UK leaving the EU would find it easy to make a large number of international trade treaties on the grounds that ‘we used to run the biggest Empire the world has ever seen’ (Daily Telegraph, February 22nd 2016).

The British Labour Party (meaning the English and Welsh parties) will have a central role in the outcome, which doesn’t auger well. The Labour Party is bitterly divided between its members, parliamentarians and leadership, and seemingly bereft of a coherent collective position on anything. Jeremy Corbyn and John McDonnell were withdrawers in 1975 and Eurosceptic since; upon his elevation to the leadership Corbyn came out for remaining in the EU, but there seems little chance of any real enthusiasm for campaigning for the UK to remain in the EU.

The Euro vote could go either way at a UK level, but the contempt which the Westminster political class is held in by the public will be a major factor in the debate and result. The narrow contours of the official debate will confirm that the UK does not at an elite level see itself as a fully-fledged European country, whereas Scotland has in the last couple of decades increasingly seen its future as an unashamedly European nation. One problem north of the border this throws up is that what the EU stands for is no longer an unproblematic good, with austerity, neo-liberalism, and a virtual European coup against Greece’s government; where does that place Scotland and what do we do about it?

The difference between the Europe many of us want to live in and the reality of EU elite rule will be central in the referendum, as will that between Scotland and the rest of the UK. This will be magnified by the fight for the soul of Tory England between the Cameroon Tories and Boris Johnson, the impact of UKIP in England and Wales, and the pro-European position of the SNP and most of Scotland’s parties. Whatever the ebbs and flows of the next couple of months, Scotland’s emergence as an autonomous, distinctive and increasingly self-governing nation will be further encouraged by the Euro debate.

This is an age of disruption and indignation, of anger and angst, of arrogance and over-reach by elites and popular revolts against them, not all of which are progressive and edifying. The EU referendum is an opening and a moment of uncertainty, where difficult questions and issues can be brought to the fore. What is British ‘sovereignty’ for and whose interests is it acting in? How can anyone invoke parliamentary sovereignty with an expression of popular sovereignty? And could Scotland in the real world really be dragged out of the European Union against majority public opinion?

The Economist concluding its assessment of the cost and prospect of Brexit summed it up: ‘Referendums are always unpredictable: a sudden shock in the markets, or even a terrorist incident, could swing voters. There is all to play for’ (February 27th 2016). The next four months will see bitter divisions in the British establishment, the Tories, Labour to a lesser extent, business and the City of London, and numerous market and financial panics, and even, runs on sterling. Britain’s elites are unsure of their future and that they have complete control on the political debate. That is a wonderful sight and opportunity.

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  1. Justin Kenrick says:

    Excellent. Somehow we need to use this process to get away from the mindset that treats the 2014 No voters as stupid (or thinks of the 2016 Trump voters as stupid) and instead recognise their fears as completely understandable. We may think their solutions are as contradictory as the following superb paragraph, but we need to have the strength to empathise and show a positive way forward. And while we’re st it lets drop the crazy turf war over the list vote. Let’s vote for what we each believe in, whatever it is, and trust that our collective diverse courage wil do more good than any amount of clever politicking.

    “Expect to hear a lot about the UK as ‘the fifth richest economy in the world’ – and then the same politicians turn around and in the next sentence argue that the UK cannot afford a decent welfare state, benefits or pensions.”

  2. Jim Bennett says:

    Oh Gerry. I usually enjoy your stuff but it seems that you’ve got yourself all worked up about a load of unrealistic assumptioms abour rhe debate.

    Gerry, mate. Nobody really cares! The vote will be absolutely decisive to stay in and then everyone apart from UKIP will forget about it. The revolution won’t be built around a vote on membership of the EU.

    What will I vote? Don’t reallyknow or care. Wjatever bughers the UK state most

    1. Jim Bennett says:

      Apologies for all the typos; bloody EU interference on my phone!

    2. Justin Kenrick says:

      Hi Jim, I guess we’ll find out which of you is right. Or maybe we’ll decide for ourselves by making use of this opportunity to show that people in Scotland do not want to be dragged out of the EU for the UKIP/ media baron reasons that are driving the Out campaign. If we decide to leave, let’s do it as an independent country that is seeking to make a better world, not as part of the Bullingdon boys game of staying in for bad reasons, or leaving for even worse ones.

    3. James Turbert (JLT) says:

      Jim

      I think you are wrong on this argument. Your saying that ‘the vote will be absolutely decisive to stay in’ and that settles it! You couldn’t be further wide of the mark.

      In Scotland, I think your argument will hold true. Why? Because Scotland will study the economic case; see what the alternative is (which to be honest, doesn’t exist. We’re basing it all on Boris’ and Nigel’s word that the EU will just trade with us as normal).

      For England however, I believe immigration will overshadow the economic case. The minute you put Farage on TV, he is not going to be talking about economics; he’s going to be talking about ‘our borders’. TV footage from Calais each night, and OTT headlines from the Daily Mail and The Sun will only fuel that argument. The economic argument will get buried …and that’s why England will vote itself out and Scotland will vote to remain in. From that point on …constitutional crisis.

      However …an excellent article. Already copied it for a deeper study. A great piece by Gerry.

      1. Mike Edwards says:

        I agree with you Jim. Through puppet Cameron, The City has got what it wants now, and, as with the IndyRef, the main stream media (MSM) will successfully bring home a Stay result. How do we know this, because one of the four key points report on by the BBC regarding Cameron’s EU deal is: ‘The ability for the UK to enact “an emergency safeguard” to protect the City of London, to stop UK firms being forced to relocate into Europe and to ensure British businesses do not face “discrimination” for being outside the eurozone’

        This essentially means The City retaining all the tax and regulation benefits it gets from its strange historical jurisdictional arrangement within the UK, along with retaining full access to EU markets and thus the privilege to ‘exploit’ the European population?

        The City has successfully seen off EU attempts the bring it under control – now on with business as usual.

        I also agree that the above article is full of unsubstantiated assumptions. For example what is the evidence that the elites have lost control of British politics? In fact quite the opposite is true. The Tory puppets are quietly, and without any meaningful molestation, privatising what is left of our public domain while eradicating the tattered threads of what is left of any democratic accountability with in the UK political system.

        Elites the world over are stronger and more entrenched than they’ve ever been. Name one geographic area or policy area where they are being meaningfully challenged?

        And regarding this EU referendum, in either case – Leave or Stay – elite interests will continue to be exercised over us from Europe and The City by one treaty arrangement or another.

        To say: “Because Scotland will study the economic case; see what the alternative is (which to be honest, doesn’t exist. We’re basing it all on Boris’ and Nigel’s word that the EU will just trade with us as normal).” Implying the EU won’t trade as normal is really crazy and exactly the kind of silly fear, uncertainty and distraction scare tactics that Better Together went on about during the IndyRef campaign. Of course trade will continue between the UK and Europe – at this juncture it is inconceivable, and impossible for practical financial reasons of entanglement, that there would be any significant disruption of trade between NATO members.

        The EU referendum is a fake. A distraction. A cover, under which, what is left of our public domain will be stolen and democracy eradicated, while the MSM (and it does still rule the day – we’re in an online bubble here) will keep our focus on EU ref nonsense.

        Unless we’re talking about how to take back control of money creation and regulate The City, we’re being played for fools.

        1. James Turbert says:

          I think you are being a tad naïve here, Mike. You’re assuming that come the 24th of June, that if it is found that the UK has voted itself out of the EU, that everything is going to be just the same.
          Mate …nothing will be the same again.

          First, Sterling will tumble. And it will tumble badly. And when Sterling falls, it’s going to hit the Euro, the dollar, and every other major currency. There is going to be a major drop on all the markets and it will all be thanks to the UK leaving the EU. The Europeans are not going to just nod, and say ‘aye, OK, let’s trade as normal’. If that happens, then every other country will do what we did, and if that happens, you’re back to the early 20th Century with trade wars, trade barriers and protectionism. That’s how WW1 started. Not over the shooting of a Duke, but wars over commerce and trading. The Europeans will be severely angry with us and will make an example of us. Trade will drop off for the UK, for why import from the UK when Italy, Germany, Denmark can produce it all the same. We’re not in the EU anymore. It’s no longer a case of share and share alike. Many of our exports may just be stopped because there is no requirement for them since other nations can produce it instead. That was the point of the EU; sharing. Not sitting outside it, but wanting to have the same terms and conditions as those in it. We did that before 1973 and the Europeans tore the British economy to shreds by denying us access to their markets. Why would they reward us by giving us everything that we used to have with them, once we are outside it? And another point – we still need to import! And that is where they will hit us. Import and export duties will go up for us and be imposed on everything that we buy or sell. They don’t need to buy our goods, but we will need to buy theirs.

          Secondly, say Sterling takes a right kicking over this (lets be honest – can you honestly say, hand on heart, that Sterling might not take a critical hit) – because if that happens – who are we going to for a bailout? The EU – that just ain’t going to happen! The IMF – then get ready for ‘real’ austerity. And then you have all those folk who have placed money in our banks as a ‘safe haven’. All these billionaires and Oligarchs. As Sterling tumbles, do you think they’re just going to watch it happen. They’ll be transferring money out as quickly as possible. We may have runs on our banks.

          And you think I’m scaremongering. Mate …I don’t agree with George Osborne, but on the matter of Sterling …I’m with him on this one. I honestly believe Sterling is going to crash on June 24th should we leave the EU …and then we will ALL be paying for it …even the elite that you believe are going to be OK.

          1. Mike Edwards says:

            James, I appreciate your passionate response. However, I think the whole premise of your line of argument is based on a misunderstanding about what is going on here. If we were voting to leave the EuroZone currency union (of which we are not a member) than much of your line of thinking would be true. But we’re voting to leave the political side of the European project, the European Union – which is essentially a collection of treaties and which is already falling apart. Your scenario does not apply. This is because of the role The City of London plays in global (including European) finance and because of the importance of the UK’s military, intelligence and diplomatic experience, resources and networks, for western (i.e. NATO) foreign policy objectives. Have you noticed that we are currently involved in a multi decade process of transforming the culture and society in most of Middle East region, as well as, containing and reimposing domination over Russia and China? NATO members are not about to start tearing strips out of each other – for what purpose?

            If we vote to leave I would stake my life that as part of the exit process we would establish treaties that would essentially retain our relationship with Europe as it currently is. Everyone is happy then. The UK Euro sceptics are happy because they are told our Queen in sovereign once again and the EU is happy because for all intents and purposes we’re still an EU member.

            As for Sterling, it is still a very important second tier currency and the UK has the benefit of retaining much control over the important factors that determine its value and stability. Of course everything has its ups and downs but there are no fundamental or economic reasons to think leaving the EU will have any significant impact on its status or value.

            Like I’ve already shown, the real work has already been done – protecting The City’s interests. How things now play out will be well managed on both sides and is therefore largely a distraction.

  3. Justin Kenrick says:

    On a very different note, but connected to the List vote issue, why don’t we change the way we elect MSPs so we only have the list regional vote?

    That way we don’t have to get into that Westminster tactical mindset, but can vote for what we believe in.

    Each MSP voted in from a region through that system could be assigned to a particular constituency so that ALL MSPs voted in through the List would become constituency MPs.

    Let’s have more proportionality, ditch having two classes of MSP, Abd make them all responsible to a reasonably small constituency.

    1. Frank says:

      The problem with the list vote is that future parliamentarians are decided by the party’s and not the electorate. That’s not just.

      1. Justin Kenrick says:

        You’re right Frank. So how about STV in 16 Regions with 8 MSPs voted in by that method and each assigned to a constituency within that region?

        That way we are voting for individuals, we take away the power of Party hierarchies to control who we think should be elected, and we make strong constituency links?

        What’s not to like for voters (however much party hierarchies might object)?!

        1. Mike Edwards says:

          Yes, look at Ireland today. Independent candidates are the biggest block. It seems like an intensely complex system to administrator though. Also, and I think more importantly, how do we reverse the subordination of our political system from the control of finance (bankers!)? If our political system is essentially powerless, messing around with our electoral systems is a bit pointless!

          1. Justin Kenrick says:

            Hi Mike

            You are right that the most important issues is wresting back the political system from the control of finance, but just saying that won’t achieve it! Having the most democratic political system possible creates the context where we have the greatest chance of persuading people its worth voting for what they believe in. Otherwise we are always subject to the “don’t waste your vote” threats that work so well to keep people in line and stop change happening.

            – Knowing finance’s control of politics is the problem
            – Getting a voting system where people are unafraid to make the choices they believe in

            Both are necessary but not sufficient,
            Together they + courage => towards sufficient motive, power => change

          2. Mike Edwards says:

            Hi Justin,

            My aim in my response to your last contribution was to consider the points you made about our electoral system. Not to get in to a discussion about were we might alternately focus our enery i.e., my aim was to identify the problem, not offer solutions – which I would be excited to explore with you elsewhere.

            I don’t follow your argument regarding the electoral system…that we should continue to expend enery trying to change the way that the thing that has proved powerless is formed. If you can show a strategy by which: 1) we have any realistic chance of changing the electoral system, and that this would; 2) lead to the formation of a political institution that had any chance of reimposing it’s authority over finance, I might be supportive of the idea. I can’t see it though!

            At this point I think we need to accept that Western style democracy hasn’t been the driver of progressive change we hoped and wished it to be.

            At best democracy has largely been implemented in a way that it acts as a safety valve for elite power i.e., providing a release for progressive energy that would otherwise actually start to challenge established powers. A safety mechanism to stop another French revolution.

            I think we need to devise new narratives and strategies for chance, rather than hang on to the hope that our political institutions (that have been set up to fail) will some how come good at some point if we expend enough energy trying to change them. It’s not going to happen 🙂

  4. Paul Carline says:

    Tend to agree with Mike Edwards. Just about everything in politics today is decided by big money and the corporatocracy – and of course the geo-strategic/geopolitical forces behind NATO’s renewed (and completely baseless) demonisation of Russia, in which that propaganda tool of the establishment – the BBC – is playing its usual dirty game.
    I wasn’t sure whether the author meant ‘illusive’ (illusory?) or ‘elusive’ in relation to the idea of popular sovereignty. It’s what democracy means. Most of the constitutions of the countries of Europe state as a first premise: “All power derives from the people”. In most cases – with the honourable exception of Switzerland (and Ireland, where important matters of state have to be referred to the people) – the premise is then conveniently forgotten, because governments don’t really like sharing power with the people who gave it to them (and should be able to challenge it, not just every four or five years, but at any time).
    A great part of our frustration comes from the realisation that we have effectively sold our birthright (as free people) for the proverbial ‘mess of potage’ – the control of our lives by a tiny minority. We need to stop thinking of the UK as a democracy, futilely hoping against hope that we might be blessed with a ‘nice’ government sometime, when the reality is that things are becoming even nastier, and will continue to do so, because the really big crash is just around the corner, and a WW3 is unfortunately not an illusion.

  5. David Sangster says:

    A very thought-provoking article, and interesting follow-up from all concerned. This is merely chipping in my ten cents’ worth, but I was struck by a comment from Yanis Varoufakis in “The Global Minotaur” that were it not for the contribution to the economy from the City, Britain would be “one of Europe’s stragglers”. It may be that protecting this pre-eminence in financial “services” is the main concern of the elite/establishment.

    While the City at present enjoys global reach, and is relatively free of competition in this neck of the woods, that could change. It is said that Frankfurt would dearly love to develop its own business at the City’s expense. Varoufakis’ remark also sounds a warning for an independent Scotland: we have seen what can be the fate of Europe’s stragglers.

  6. Alf Baird says:

    Independence is a far bigger issue for Scotland, relative to whether we remain in or leave the EU or any other supranational organisation. With independence, Scotland can do as the Scottish people wish, whereas just now we are always going to be used in the interests of others. Makes no difference whether the issue is defence, immigration, economic policy, foreign policy, or membership of supranational organisations like NATO, the UN, or the EU. Scots will never decide these ‘big’ issues until independence is achieved.

  7. willie says:

    If elites no longer control our politics in Britain why are the rich getting richer and the poor poorer. It’s a simple observation.

    1. Alf Baird says:

      ” in Britain why are the rich getting richer and the poor poorer”

      The rich put their cash into the the UK’s privatised former public utilities/monopolies (e.g. energy, water, ports, airports etc), most now registered ofshore (so they pay little or no tax) which in a deregulated/self-regulated market make consistently high returns – so easy risk-free returns for the rich. Meanwhile the masses including you and me pay higher and higher prices to access the services these poorly regulated monopolies provide. Hence the rich get richer and the poor get poorer. I would add that these utility monopolies tend to invest relatively little in new infrastructure, instead using surpluses mainly to repay investors which, coupled with high prices, explains why our economy is not internationally competitive.

      The solution to the resultant rising inequality and lack of competitiveness is either far better regulation (including price regulation, licensing, a prohibition on offshoring, forcing owners to invest etc), or nationalisation, or both. Of course the devolved Scottish Government does not have the powers to do either just now. But even it we were independent, we might wonder if the SNP would rock this cosy UK corporate boat.

      1. willie says:

        The rich are becoming richer Alf because the poor let them. It’s that simple. Fiscal Apartheid where a few have and the many don’t is the order of the day. Foods banks, fuel poverty, minimal wages. Certainly seems to me that the elites a very much in control!

        1. Alf Baird says:

          Willie, the point I was making is that our privatised ‘utilities’ are continually being acquired and re-sold by/to other private equity groups, who are by and large borrowing money from ‘investors’ in order to acquire the business/utility via a leveraged transaction. This means the the acquired business remains heavily in debt, and that debt in turn needs serviced, and the only way to do that is to extract large surpluses out of the business, hence prices must remain high. Private equity pay a large premium (i.e. inflated asset value) to acquire said utilities, which also leads to higher debt service re-payments, and high ‘management fees’. Ultimately the masses/the poor are paying for this dysfunctional aspect of ‘capitalism’. See for an example: http://reidfoundation.org/2016/01/sort-out-our-ports/

          1. willie says:

            I agree entirely Alf. Ordinary people are paying through the nose for privatised utility services. It is a Ponzi scheme of the highest order where maybe 40% in every pound paid goes to feed corporate profit and corporate debt. But who gave these private equity masters the money to enslave whole nations. Where did they get that money. We used to own these assets before the corporate elites did.

          2. Alf Baird says:

            “Where did they get that money. ”

            Good question Willie. Nobody knows, because there is little transparency with offshore private equity ‘funds’. So we don’t really know who owns Scotland’s essential utilities in energy, or major ports and airports etc. What we do know is they continually extract risk free surpluses/profits, and re-invest very little in new infrastructure. So as an economy, us consumers, including the poor, end up with high prices and outdated infrastructure, which explains why our economy is not internationally competitive, and why the poor get poorer. I’m surprised the SNP have yet to figure this out, yet it is a (perhaps ‘the’) key factor holding back economic growth and inequality.

  8. Douglas says:

    Well, I don’t know if I can buy into Gerry’s optimism here that the elites are no longer in control. We just saw how the UK voted for Cameron – one of the most intellectually limited politicians who ever held office – and, as we know, the Scots were asked if they wanted to start a new country, and they didn’t have the bottle for it….an embarrassment….

    …I think Mike Edwards is right when he says that even if the UK votes to leave, it will stitch up a deal which effectively leaves us in the EU in some round about way. He is also right to stress the difference between the EU and the Eurozone, they are two entirely different things, and it is the Eurogroup – the finance ministers of the Eurozone countries – who call the shots these days. These guys are single handedly killing the European project, even in countries as pro European as Spain….

    ..we need a new Europe, but to leave would be a huge mistake.

    As for the Eurozone, a prediction: the shit is going to hit the fan, and it will be the biggest crisis of them all. Europe either comes out if it with some kind of loose federalism, or the Right wins and petty nationalism takes over…

  9. Ian Kirkwood says:

    Elites will continue to dominate the UK as long as they can prevent a majority from demanding the return of privatised economic rent. This can be prevented by the elites taking measures when necessary to enlarge the population of property owners to a sufficient number. Free capital gains, funded from land values that are created by the efforts of society, are the bribe that each house owner gratefully accepts (vis. the invention of New Labour) and are sufficient to ensure lifelong allegiance from the newly extended privileged sector.
    Until we each recognise that AGR (see http://www.slrg.scot) is the missing public value that makes us a poor country, the elites will be in no way put out.

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