Get Red Pepper's email newsletter. Enter your email address to receive our latest articles, updates and news.
It’s less than 18 months since the Occupy protests spread worldwide and already the spotlight they shone on the global financial crisis and the reckless and unaccountable behaviour of the private banks and other powerful global financial actors has begun to dim.
Concrete responses to the underlying causes and drivers of the financial crisis have been feeble and half-hearted at best. Here in the UK the government is still dithering over whether to implement the weak Vickers commission proposal on ringfencing retail banking. Nowhere is there any sign of interest in the kind of co-operative global political action that is needed to gain public control over the financial speculation that is destroying people’s livelihoods. On the contrary, private and shadow finance is increasing its grip over public life and the modes by which it is able to extract wealth from ordinary people, both directly through debt provision and indirectly through our taxes.
Governments around the world are encouraging the growth of public private partnerships (PPPs), known in the UK as private finance initiative (PFI) projects. They feed the growth of a parasitic private finance sector comprised of banks, investment funds and shadow finance actors such as private equity funds, which attach themselves to the state as a new source of secure, low‑risk profits.
PFI increases corporate ownership and control over public services and increases the net outflow of taxpayers’ money into the pockets of private finance – money that could otherwise be invested in improving and extending public services and infrastructure. The government promotion of PFI is contributing directly to increasing inequality and the concentration of wealth, while at the same time reducing democratic control over public services.
On page 20 Nick Hildyard exposes how this is not just happening here in the UK or the rich world. PPPs are now increasingly relied upon to deliver and extend basic services and public infrastructure in much of the global South. In environmental policy too, there is a growing reliance on private finance.
This growing power of private finance is part of the bigger process of financialisation to which we have borne witness over the past few decades. The Marxist geographer David Harvey describes the rapid growth, globalisation and deregulation of the finance sector since the 1970s as leading to the ‘financialisation of everything’, meaning the growing control by finance of all areas of the economy and public life. The global capitalist class is increasingly making its money from finance rather than by investing in production. And the expansion of control and ownership of private finance over public infrastructure, services and resources is part of this process of financialisation. It is essentially a form of primitive accumulation: a new wave of enclosures of the commons.
Tackling this is clearly a long-term project for the left. We are still trying to understand what exactly is happening, to cut through the opaque and complex processes of global finance and divine the real games at play and their wider impacts. Many complications lie in the way of our search for solutions, including the fact that many of the core actors driving these processes operate under the radar, holding unpublicised meetings in anonymous offices and listing their companies in offshore tax havens. Another is that many of the investment funds at the core of this process are using capital from the pension funds of those who are lucky enough to still have pensions to provide the initial equity investments in PFI.
Yet financialisation provides us with an enormous opportunity. It is the common ground for a multiplicity of struggles, a unifying point unlike any that we have seen since the international mobilisations against the Iraq war. Financialisation links the struggles of activists in the UK campaigning to protect the NHS with activists in Brazil campaigning to retain democratic public ownership and control over the forests and the rights of the people who depend on them.
Turning the tide on the power of global finance requires us to remake the case for public ownership and control of the commons in a way that learns from the past weaknesses in bureaucratic and sclerotic state control. It requires us to stop the haemorrhaging of money from public finances into the hands of the private sector parasites by resisting PFI projects and ending the whole PFI agenda. And most importantly, it requires a renewed focus on the redistribution of wealth.
To start with, we must tackle the supposed lack of finance that is pushing governments towards reliance on private investment by demanding a crackdown on the tax evasion by global financial elites and transnational corporations – as articulated so effectively by UK Uncut – and by challenging the low tax regimes of the neoliberal era that let corporations and the super-rich off the hook.
Grace Blakeley investigates the curious case of Carillion: how the company’s slow decline and abrupt liquidation reveals the nature of modern capitalism.
The collapse of Carillion could be a watershed moment. Let's seize it to end economically disastrous outsourcing schemes. By Cat Hobbs.
Campaign groups highlight UK complicity in Saudi Arabia's human rights abuses.
Three founders of Momentum talk to Ashish Ghadiali about the two years that have transformed their lives and the fortunes of the British left.
Andrew Smith from Campaign Against the Arms Trade gives the run-down on one of the UK's most profitable - and most deadly - industries.
The real story behind the fire in Grande Synthe’s Linière refugee camp, Dunkirk. From 'Bordered Lives – How Europe fails refugees and migrants' by Hsiao-Hung Pai
Javier Pérez De La Cruz writes about the working class Berlin neighbourhood wrung dry by gentrifiers.
Across the world, thousands of protesters are taking on the planet’s biggest fossil fuel companies. We should support them – and if we can, we should join them. By Kara Moses
Students are suffering the effects of financial instability, stress, and slashed mental health services. Mark Crawford reports.
They're not defending free speech - they're just seeking to shore up their own power, writes Ilyas Nagdee
Jeremy Hunt is poised to flog the last of the NHS
Peter Roderick sounds the alarm on an 'attack on the fundamental principles of the NHS'.
Viva Siva, 1923-2018
A. Sivanandan, who died this week, was a hugely important figure in the politics of race and class. As part of our tributes, Red Pepper is republishing this 2009 profile of him by Arun Kundnani
Sivanandan: When memory forgets a giant
Daniel Renwick calls for the whole movement to discover and remember the vital work of A. Sivanandan, who died this week
A master-work of graphic satire
American Jewish cartoonist Eli Valley’s comic commentary on America, the US Jewish diaspora and Israel is nothing if not near the knuckle, Richard Kuper writes
Meet the frontline activists facing down the global mining industry
Activists are defending land, life and water from the global mining industry. Tatiana Garavito, Sebastian Ordoñez and Hannibal Rhoades investigate.
Transition or succession? Zimbabwe’s future looks uncertain
The fall of Mugabe doesn't necessarily spell freedom for the people of Zimbabwe, writes Farai Maguwu
Don’t let Corbyn’s opponents sneak onto the Labour NEC
Labour’s powerful governing body is being targeted by forces that still want to strangle Jeremy Corbyn’s leadership, writes Alex Nunns