Category Archives for "Mutuality"

0 Planning

My last post about community planning, completed a sequence about the representation function of my three function model and so it is time to move onto the second:

The last post about Community Planning emphasised why it is important not to confuse your local plan with the plan agreed with your partners.

Some formal planning meetings are somewhat daunting!

When you meet with partners from the local authority, police, NHS, local schools, local businesses and so on, they will each have their own plans.  Their plans are worth no more than your local plan, although they might have spent more money on it and so may like to think theirs is more important.

So your role is negotiation, aiming for agreement to as much of your plan as possible.  Remember you won’t get all of it or even necessarily the parts you would most like.  Perhaps the people of Maltby would have prioritised a by-pass over everything else.  They were never going to get a by-pass but other chapters in their plan were very successful.

So, you need to think about how you can increase your plan’s credibility.  First, consider your methods.  How did you write the plan?  How many people did you involve in the planning?  I estimate the Maltby plan included material from over 400 people.  The plan itself included by-lines from people who didn’t necessarily agree with the main argument.  An uneven plan can be more credible because it shows the plan is not the product of one small group of people.

Think about how you’re going to present your local plan.  Negotiations may involve several meetings with partners.  Who will take part and how will you support them?

Some groups send different people to each meeting.  This may show wide support for the plan but it sacrifices continuity.  Consider a small group that meets between the meetings with partners to debrief the last meeting and prepare for the next.  You can then send one or two members of the group to each meeting.  Thus you preserve continuity whilst demonstrating wider support.

I would normally send at least two people to meetings with partners.  More than two might be difficult to accommodate.  With two people present, one can be the main representative and the other take notes and make suggestions from a less pressured perspective.  They can rotate these two roles.

Such arrangements, so long as they are not too complex, can appear impressive.  A consistent line represented over several meetings by a small group may appear more credible than the same line represented by one spokesperson.

Remember you won’t have a lot of money or assets compared with other partners so you need to show you are an organised and disciplined group.

Pay attention to the plans of your other partners; get hold of copies and read them.  In your planning group, divide their proposals into four groups. Proposals that

1. support what is in your local plan.
2. address issues not covered in your local plan.
3. could be tweaked to line them up with your plan (or where your plan could be tweaked to line up with their proposals).
4. you cannot agree to.

Work out what you want to support, what you think could be changed and what you oppose.  Some things you may oppose but be willing to trade for other parts of your plan.

Keep your powder dry!  Don’t go in and simply state what you support or don’t support.  You may be able to gain support for your priorities from partners who appreciate your support for theirs.  You’re likely to lose some arguments and so plan ahead!

And finally, don’t sacrifice your integrity, be consistent and don’t walk out if you can possibly avoid it.

These negotiations can be fraught with difficulty.  I’d love to hear your stories about how they’ve worked out, positive or disastrous!

2 Creating an Economy for the Common Good

The retail co-operative movement and its associated mutual experiments, was for a time a parallel economy for the common good to the dominant liberal economy of the Victorian era.

It challenged not only the mainstream economy but also the stream of socialism based on trade unions and centralised state ownership. It offered collective ownership as an alternative to private and state ownership.

This model not only flourished but initiated many institutions that are today foundational to the mainstream economy. Sadly, the government privatised many of these institutions; privatisation has absorbed not only nationalised industry but many mutuals. Its grip on the economy and our imagination is far greater than the so-called threat of communism achieved.

From the perspective of the twenty-first century, communism was never an alternative to capitalism.  The Soviet Union practised state capitalism and trade union based socialism in Britain was an accommodation to the capitalist economy and not a genuine alternative to it.  The difference between twenty-first century businesses and the days of trade union power is the decline of large industry.  It is hard to see how unions could regain the power they once had without these large employers.  Large companies these days are not employers but accumulate capital.  Perhaps these differences are a matter of degree but trade union decline cannot be fully reversed by a more favourable legal environment.

Change Everything

It is hard to envision an alternative to the prevailing neo-liberal model and that is why I welcome Christian Felber’s new book, “Change Everything: Creating an Economy for the Common Good”. Here at last is a credible alternative!

The Economy for the Common Good is an international movement, originating in Austria. Felber’s book is the first time his thinking has been available in English. In it he describes a framework for a new understanding of the economy; moving from “the business of business is business” to “the purpose of business is the common good”.

It is important to understand Felber is not promoting a single model for the economy but a different standard any number of models can address. This standard attempts to overturn the neo-liberal mindset, which sees competition as central, to a worldview based on co-operation. I’m planning to review this book over several posts. In this first post, I shall make three comments, reflecting my concerns about his approach. They are not so much criticisms as attempts to show where there may be difficulties.

I want to promote the book as I cannot possibly, in a few posts, do justice to the ground it covers.  These comments may assist a critical reading.

Co-operation happens already

One of the lies about the neo-liberal model of the economy is business depends solely on competition. Felber claims competition is less effective than co-operation and I would go even further.

Felber includes a chapter of examples of the economy for the common good from all over the world. These are valuable and important and I plan to write about some of them soon.

What I don’t think he dwells upon fully is how even neo-liberal business depends on co-operation. Competitive ideology undermines business because it is naturally collaborative. Successful businesses collaborate. Many small business owners flounder because they believe the politicians and think they are in a cutthroat competitive environment.

Too much business collaboration is behind closed doors. Many scandals are where politicians are swayed, where relationships become way too cosy.

So, with the neo-liberal worldview collaboration can become counter-productive but for most small businesses it is a natural route to a prosperous business. Good businesses put business in the way of other businesses; they help one another to grow.

Felber’s values would place business collaboration in the service of the common good and not primarily for private profit.  He does not rule out private profit but moves it away from being the main point of economic activity.  Many entrepreneurs might embrace Felber’s approach because it offers a more supportive environment than the neo-liberal model with its aim to centralise economic activity in a few powerful hands.

An economy within an economy?

Felber’s approach is admirable because it could in principle replace the prevalent neo-liberal model. It’s certainly possible, after all in the immediate post-war years, neo-liberalism was the preserve of eccentrics. Owen Jones describes in the first chapter of his book, “The Establishment“, how these peripheral eccentrics developed the dominant ideology of our time.  Now we’re the eccentrics, up against powerful vested interests.

The reality is, for a time at least, the two worldviews will co-exist. This is much as it was for the co-operative movement. For all its successes it never broke through and ultimately lost out to the uneasy alliance between capitalism and a trade union based socialism.  We can see now this version of socialism was not really an alternative to the capitalist system but an adjunct to defend the interests of workers within the system.  This unstable alliance ultimately collapsed when neo-liberalism became dominant during the 1980s.

Never underestimate the power of dominant ideologies to colonise opposing worldviews, just as mutual businesses have become neo-liberal businesses.  Another example is the domination of the Christian faith by the Roman Empire.  Constantine bought into Christianity because he believed it would help him win wars.  That ideological struggle continues to this day at the heart of every church congregation.

A Worldwide Movement for Change?

Is it really credible that a worldwide movement can usher in a new approach to the economy over the entire world? It is a tall order and I hesitate to even concede it is possible.

I think we need to look again not only at the successes of alternative economies but also at their failures. Why did the co-operative movement lose out to the conventional economy, to the extent it largely disappeared in the 1980s UK?

It’s worth asking how far we can go without dismantling the neo-liberal systems? It may be essential to dismantle them but what happens if they persist? What if the vested interests are too powerful? What can be achieved under those circumstances?

Understand I ask these questions to strengthen the movement. People need to see immediate benefits if they are to commit to this approach. Each person who commits weakens the old system and so the advantages of a parallel economy need to be clear.  I shall return to this theme in the future, especially to explore how the Internet can support this parallel economy.

The Challenge to Privacy

Many people fear what happens if Felber’s models are too full on. What if our economic systems imply a society where differences are not tolerated, where everyone knows everyone else’s business?

This appears to be a concern among those living in alternative communities and it is something important to take seriously. Why?

Because the last socialist experiment was a civil liberties disaster. Granted it was state capitalism, capitalism by other means. But it is always true in human systems that freedom and equality can be opposed.

Felber’s approach is attractive because there is no single model. Small businesses can still exist, offering independence to their owners and they can choose the extent to which they adhere to Felber’s framework. This allows perhaps sufficient wriggle room to allow substantial freedom in a world where there is greater equality.

Freedom and equality are not natural givens and they need to be understood and defended.  What do you think?

2 Representation 3: Community Planning

Last Wednesday, I continued describing my three functions model for community development, with a second post about representation:

This is the third of three posts about representation:

1. Provide a meeting place
2. Generate and record deep conversations
3. Agree a community plan

The Maltby Community Plan

Community planning in Rotherham started after the 2000 Local Government Act, which set up Area Assemblies (the name of these varied from place to place – does anywhere still have them?) and directed all Local Authorities to prepare a community plan for their borough.  This was to be used by the Local Strategic Partnership to govern planning across the Local Authority area.  (If you think calling a borough-wide plan a community plan is misleading, I agree!)

In Rotherham, the Local Authority decided to base their community plan on local plans and they identified 60 distinct communities within the borough.  I’ve no idea whether they actually achieved this but full marks for ambition.

The Local Authority plan and the local plans were different types of document.  The former had authority and set the framework for local partnerships.  The local plans expressed as far as possible a local consensus for developments in their neighbourhood.  The Local Authority decided what to include from the local plans in its borough plan.  Residents could still work from their own plans at partnership meetings.

The Maltby By-Pass

Shops in High Street, Maltby (during a quiet period!) (David Martin) / CC BY-SA 2.0

I developed the first of Rotherham’s local plans (this is what most people would call a community plan) in a small market town called Maltby.  One incident  illustrates the confusion between local and borough plans.  I circulated a draft local plan, which included a well-argued case for a by-pass to take heavy traffic off the town’s high street.

An irate phone call, from the Council’s Highways Department, complained they had not agreed a by-pass for Maltby.  They were annoyed because the chapter was well argued and they wanted to know who had written it.  I was reluctant to tell them the author was the owner of a chip shop on the high street!

Highways had misunderstood the purpose of the local plan.  It would be filleted by the local authority to contribute to their borough plan at a later stage.  The plan expressed the consensus of the local people and it is relevant to know they want a by-pass and why they want it.  How the strategic partnership might respond to their plan is another matter entirely.

The Power of the Community Plan

It is equally important for local people to understand the status of their plan.  No external organisation can be bound by what amounts to a sophisticated wish list.  The power of the local plan is in the extent to which it represents the views of residents.  If local people meet and discuss the issues that affect their community then their local plan carries more weight with partners.  I estimated we consulted with at least 400 people to prepare the plan.  Out of a 10 000 population, do you think that is a credible sample?  We could show it was a diverse group of people.

Without a plan it is hard for local representatives to make a credible case to potential partners.  It provides a mandate for community activists but it has no authority for anyone else.  As such a community plan is essential for residents if they want a say in local planning.  The next post will explore negotiation of local plans.

Leave a comment if you have prepared a community plan.  How do you use it?

0 Representation 2: Deep Conversations

Last Wednesday, I started to develop my three functions model, by exploring representation in-depth.

This is the second of three posts about representation:

1. Provide a meeting place
2. Generate and record deep conversations
3. Agree a community plan

Many groups have problems encouraging conversations even though they can get people together. Understanding conversations is essential for community development online as well as off and so I have written about them in some detail.

With BCAF (Burngreave Community Action Forum) we managed to bring over 60 people together once a quarter for many years.  Why did they attend these meetings?  They cared about their neighbourhood and its development.  They also turned up to socialise and share in a good free lunch.

So, what did BCAF do?  In the early days, we sat people in rows and invited decision-makers to address the meeting.  They were willing to come out on a Saturday morning because they knew they would get a good-sized audience.  But these meetings became tedious.  They often went on for far too long because everyone wanted a say following each presentation.

The problem was conversations were not taking place in any depth.  Contributions from the floor were often a view already formulated before the presentation.  Other people came to complain about something and introduced it when they could, unrelated to the presentations’ contents.

Eventually we worked out people needed time to talk in groups and after experimenting with buzz groups and break out groups we eventually worked out we would be better off sitting people in groups for the entire meeting.  This reduced time moving between groups and helped buzz issues between presentations.  (Tables also provided somewhere to balance plates of food!)  There are drawbacks, most notably difficulties for the hard of hearing but on balance it’s the best way we found.

Groups can be supplied with hand-outs and flipchart paper with pens.  The latter allows for written as well as verbal feedback.

A lot more can be written about this approach and I’d like to hear whether you have used it and with what results.

Conversations in a Community Cafe

But what about conversations in a community café?

The first thing to note is conversations will take place all the time.   People can be invited to complete a brief form with contact details and a brief account of their issue, idea or concern.  This may be something they bring to the café to share as a concern.  Or maybe something arising from general conversation and that’s worth sharing.

If you have a local concern and want to canvass views, it can be outlined on notice boards or a stall.  People might be invited to complete a questionnaire or leave their contact details if they wish to support a campaign.  People might be invited to discuss an issue at their tables at publicised times .  This would be an opportunity for key people to listen to conversations.  Or key people can circulate at any time and ask a table if they would be willing to discuss their issue.

Participative appraisal (PA) is a helpful approach. It is a number of tools, mostly pen and paper, with a philosophy of deep listening.  This enables any participant to ask questions and involves everyone; their voices not drowned by the more vocal.

The layout and history of your centre will help you work out how to canvass views; simply try things to find out what works.  But what if you want to take things further and agree a community plan?

Leave a comment and tell me about your experience of community planning.  I’ll offer some tips next time.

0 The Living Wage or Citizens’ Income?

We live in a welfare state and the major recipients of welfare are the Corporations. It’s the rich that get the money and the poor that get the blame.

The Corporations pay low wages and expect the state to top up their employees’ wages through tax credits. There’s a similar scam with housing benefit. Employers set wages just like landlords set rents and both expect the state to make up the difference.

The Living Wage

So, the Chancellor has impose restrictions on tax credits. He also claims to have introduced a national living wage, by which he means a version that will not upset the corporate lobbyists.  This so-called national living wage is really an inflated version of the minimum wage.  The living wage is supposed to be a wage where a family lives without benefits.  This new level of the minimum wage does not fully compensate families for the loss of tax credits.

You see if the Chancellor wanted to introduce a genuine living wage, he could offer financial incentives to businesses, to help them pay it. The government could means test businesses compensate them if they genuinely need help.  The Corporations would need to use their offshore accounts or bosses’ bonuses to find the difference.

It would be interesting to explore the consequences of businesses going cap in hand to the government. Why should employees accept the blame for their employers’ stinginess? If employers had to make their case directly to government to receive benefits to subsidise their wages, it would be a massive increase in accountability.  They would have to pay at a rate equal to or more than the living wage set by the low pay commission.  I suspect most Corporations would find the money.  It would be small businesses that would need to the financial support.  And why not?  With the level of subsidy for businesses overall reduced, the state would assist small businesses creating jobs in the local market.

The Small Business’s Dilemma

Without help, many small businesses would go bust if the living wage were compulsory. Let’s say someone opens a coffee shop and employs one person on the minimum wage. That person currently claims tax credits which helps them pay their bills.

The business owner meanwhile lives on drawings from the business, which often means they live on their savings.

One claim about the living wage is if everyone received it there would be more money circulating in the economy. In theory this means more people would have spare cash to buy cups of coffee. Increased pay for the employee is a fixed amount going out every week. Increased takings depend on factors that cannot be guaranteed. Even with more money circulating because everyone is on a living wage, it’s no guarantee the coffee shop would break even.

This is the dilemma facing many small local businesses. Whilst Corporations grumble about paying the living wage, they have more capacity to accommodate such changes.

The idea of grants to businesses who pay the living wage is one possible approach. It would save government money by means testing businesses. The Corporations would need to redeploy some of their offshore profits. It would be very clear they’re the beneficiaries of government subsidies and do away with the illusion it is the poor who are to blame.

Citizens’ Income

A living wage is certainly an attractive model because it would make the Corporations accountable. The alternative would be citizens’ income. Here everyone would receive a payment irrespective of whether they are in or out of work. In work, all earnings are taxed. Employers would be obliged to pay a minimum wage because when people have some income, they are less likely to accept low wages.  The government could set the minimum or leave it to market forces to work their usual magic (usually not a good idea).

Citizens’ income resolves a lot of issues for small businesses because their staff are subsidised already.  However, citizens’ income subsidises corporations unless they contribute to it.  So, tax businesses on the number of people on their payroll and allow them to claim tax credits if this tax means genuine hardship.

Living Wage or Citizens’ Income

Citizens’ income does achieve a lot of what we need, ending welfare dependency and getting money flowing in the economy. However, is it able to make the Corporations accountable to the government in the same way as a compulsory and subsidised living wage? It’s big advantage for local businesses is simplicity, they would have no administration and would not need to apply for grants to subsidise their pay.  (I’m assuming my idea of taxing businesses to pay for the Citizens’ Income is not on the agenda.)

Whilst there is a need to debate these two approaches and understand their relative merits, do not forget one thing. The whole system supports the interests of the Corporations. They will resist both approaches because the current system of unaccountable subsidies for Corporations from the state suits them fine.

0 Representation 1: Unstructured Meeting Space

In my last post, I described my three functions model.  The next step is to explore the three functions.  Here they are:

You need to do three things (covered in this and the next two posts) to develop representation in a neighbourhood.

1. Provide an unstructured meeting space
2. Generate and record deep conversations
3. Agree a community plan

For over 10 years the area where I live had a Forum.  It was called Burngreave Community Action Forum or BCAF.  It met once a quarter on a Saturday mornings and at least 60 people turned up.

This approach has financial costs if you’re going to do it properly.  You need to pay for a leaflet through every door, backed up by posters and announcements in local papers, etc.  A free lunch also helps, it is an opportunity to socialise and maybe some people turn up for the lunch who wouldn’t otherwise.  BCAF also provided childcare and a translation service.

Wyverstone Community Cafe

Any neighbourhood wishing to develop community needs a meeting place.  Quarterly meetings are one possibility.  Another might be a community centre with a café.

Think in terms of “unstructured meeting spaces”, where people can meet without an agenda.  Some community centres offer rooms for hire but no space where people can grow community.  Even more worrying are neighbourhoods with no meeting spaces at all.

Roles for Unstructured Meeting Spaces

So, what might you aim for?  It’s likely your centre will need to pay its way and so I’ve included some suggestions for paid activities.

So far, I’m describing how a neighbourhood might bring residents together.  But how do you generate and record deep conversations in a coffee bar or indeed any meeting?  Let me know what you think and I’ll offer my suggestions in my next post.

0 Sunday Trading or Weekend Market?

In this series of posts I’ll explore some of the issues local businesses face. What do I mean by a local business?

There are two types: established and developing. An established local business will do three things:

1. Employ workers and pay them at least a living wage (original definition)
2. Pay their taxes without tax avoidance
3. Invest surplus locally

These are objectives and many local businesses fall short of them for a variety of reasons.  Some are too small to employ staff or can’t afford the living wage. Some are too small to owe taxes or they do not generate sufficient surplus to invest.

The economic environment in which local businesses operate is adverse. It is adverse because of the decisions made by politicians of all parties over many decades.  So, most local businesses are developing. They may aspire to be established but find they fall short. This is why many local businesses are small.

And we have to face it, many self-employed people have little prospect of breaking even but are under pressure to stop signing on.  Self-employment is one of ploys used by this government to massage the unemployment figures and so claim employment is on the increase.

Sunday Trading

The demand to bring an end to restrictions on Sunday trading has been in the news recently. The BBC has found an endless procession of vicars to discuss family life. They also found trade unionists who rightly express concern for workers who not only have to work on Sundays but will lose the extra pay many receive for working on a Sundays.

I want to leave these arguments to one side. It is well established that everyone should have at least one day each week free from work and it is reasonable to expect this to be on the same day as the rest of their family. Perhaps it is not essential everyone agrees on which day it is. Not all religious traditions celebrate the same day and people should be free to celebrate their chosen day and equally free to trade on the other six.

My concern though is why the government is considering legislation to enable local authorities to authorise lifting restrictions on Sunday trading. Members of Parliament rarely have ears for anyone other than corporate lobbyists. It has to be at their behest because it is solely large corporations that lose out at present. Large stores are currently permitted to open for only 6 hours on Sundays.

This allows a minor competitive advantage for small local businesses. With so little money in circulation, local economies cannot afford corporate interests to hoover up more and salt it away in offshore accounts.

Weekend Markets

There is a limited amount of money in circulation and lifting these restrictions will not increase it. It will increase the amount leaving local economies. If only local businesses had their own lobby, maybe we would start to see legislation that favoured them.  Just imagine if it were possible to extend the restrictions to 48 consecutive hours of closure each weekend!  This would allow smaller traders to establish their businesses, build a customer base and maybe introduce a greater sense of community into the shopping experience.

The large supermarkets, department stores and shopping malls have taken shopping out of the public space.  If they were not permitted to open at weekends, it would offer public spaces an opportunity to develop what they had to offer.  This might actually favour churches and other non-trading bodies as their activities belong in the public space.  (I understand some churches in the United States are in effect shopping malls.  This is not something I would encourage as it is still privatising shopping space.)

But it is quite different to envision stepping out of a church service into a thriving local economy.  Under these circumstances the church would contribute to the weekend economy by being another reason for people to be present in the marketplace.

Family life?  Well, the Corporate employees would have their 48 hours.  If this allows smaller businesses to become established, then maybe they could afford to close mid-week when demand would be less while the big stores are open.

Of course, this will never happen and even if it did, it wouldn’t work in isolation from other changes needed in the local economy.  So, this is part of a larger vision.  Next week I shall show how the local economy could be funded.

5 My Three Function Model

My key community development model.

In last Wednesday’s post about how to use models, I promised this time I would introduce my key three function model.   I’ve found it simple to use and effective.   How do you use it?   You find out where and how these three functions are taking place in your neighbourhood.

No two places are the same and you find sometimes several organisations share a single function or it is absent.   Sometimes one organisation is responsible for all three.   Once you know who is responsible for these three functions, you can find out how they work together.

In general, I seek a clear separation between these roles, encouraging them to be delivered from different organisations. However, some organisations are able to carry out all three and if that is what is happening, the next step is to ask how it’s working and how to improve the ways in which they interact.  It is usually not a good idea to impose changes so the model fits better, remember all models are descriptive, not prescriptive.

The Three Functions

1. I usually put Representation along the base of the triangle because it is the foundation for everything else.  You need some means of bringing people together and helping them discuss and develop their ideas.
2. Planning is an activity distinct from representation and so do not confuse the two.  Planning is a partnership activity.  If partners are not present, you are not planning.  What you are probably doing, and this accounts for the confusion, is preparing for your planning.  If you are going to plan for real change in your area, you need a community plan because all your partners, the local authority, the police, the NHS – whoever they are – will have their own plans.  Maybe planning would be better labelled ‘negotiation’ but I insist on leaving it as planning because that is what you do when you sit down with partners who, like you, have their own plans.
3. And delivery is implementation of ideas from your planning.  If you want lasting change, delivery should emerge from negotiated plans.

Using the Three Function Model

The power of this model is in the way you circle it.   Circle clockwise and it is a development process.   So,

Circle anti-clockwise and you have accountability.  So,

Either of these flows can be blocked in various ways and the development worker’s challenge is to name blockages and help others see them too.  That should keep you busy!

Can you think of examples where you can apply this model?   What did you learn and how did it help?

1 How to Use Models

One key skill development workers need is how to use models. They are in practice mentors for activists. So, they need to know how to read the situation in a neighbourhood to support local activists. This is the fourth post about these four topics:

If I were mentoring a development worker or activist and suggested a model that might apply to their work, I would monitor how the worker or activist used the model.

Not all models are in words. They can be pictures, maps, photos and even 3D models.

Models can be seductive and when they seduce us, we surrender our critical faculties to them.  The model becomes prescriptive.

Models are better understood as descriptive.  They help the development worker look at and understand what is happening in their community.  Models do not and should not tell the worker what to do.  What workers do should come out of the conversations they have with local residents and conversations can be informed by a model.

Models Generate Questions

Perhaps a worker might use a model to generate questions about what is going on in the neighbourhood.  The conversations generated by these questions can be inspiration for the worker and for activists.

If a model suggests an organisation in most successful communities carries out a particular function, it does not mean your community needs a new organisation to carry out that function.  In conversation you may find the function happens in ways not immediately obvious.  Or you may find an entirely different approach that works around the lack of the function locally.

Models inspire conversations and so generate new, home-grown ideas.  Remember, nothing should be attempted just because it worked somewhere else.  Maybe the way the other community generated their idea is what you need to copy.

Leave a comment if you have experienced positive or negative use of models.  Maybe you have introduced an idea from somewhere else and it worked!

Next time, I’ll introduce my key model.  It pulls together many of the issues I’ve covered so far.

2 The Establishment

Everyone seems to be reading “The Establishment And how they get away with it” by Owen Jones! It is a popular book about political economy! I’ve seen people reading it in coffee shops and on public transport many times.

Perhaps it’s an easy read because its insights are shocking. Sensationalism always sells.  But it lifts the veil from what is really going on and everyone should take an interest.  Like the proverbial frog in water slowly increasing in temperature, we have been hardly aware of the steady erosion of the post-war economic consensus.  I can remember my father telling me in the sixties that there was no need to worry about money because the state would always take care of us.  I’m afraid he was wrong.  The benefits his generation fought for can no longer be taken for granted, according to Jones.

The Local Economy

I’m interested in the implications for local economies. First, this is not about being pro or anti-business. I’ve read a lot about the Labour Party’s performance during the last General Election. The consensus seems to be that Labour is pro small businesses that are just starting out at their own risk but against successful businesses, they labelled as predators.

This article about Mary Creagh  is typical of the criticisms Labour has received, primarily from its own members. The Guardian quotes her, saying when she withdrew from the Leadership contest, “Labour cannot be the party of working people and then disapprove when some working people do very well for themselves and create new businesses, jobs and wealth.”

I don’t know whether this is fair criticism of Labour but it displays a common misapprehension about business. The issue has nothing to do with the size or success of businesses. The issue is whether businesses are local; which means they make a net contribution to the local economy.

I deliberately leave the term “local business” open. It could mean your neighbourhood, city or region. It could even apply to a business with national reach. The key issue is what it does with its profits. Negatively, this means it does not avoid tax and salt its takings in off-shore bank accounts. Positively, it pays its workers a living wage, pays its taxes and invests in the economy.

How Local Business is Undermined by the Establishment

This is the underlying argument in “The Establishment”. The interests of local businesses and large corporations are opposed. Attempts to regulate the predators benefit local businesses, or should do. Jones writes on page 225:

“Tax avoidance also hammers local, smaller businesses. The owners of, say, a modest independent coffee shop cannot hire an army of accountants to exploit loopholes in the law, or import costs from foreign subsidiaries to offset against tax, or dump profits in tax havens. They simply have to pay the tax that is expected of them. And by doing so, they are at a competitive disadvantage to multinational companies who exploit the law.”

Jones emphasises small businesses here but I imagine some fairly substantial businesses suffer the same competitive disadvantages. The reality is most local businesses are not that bothered by high taxes for high earners because they would welcome an opportunity to pay such taxes!

Jones asks why it is government and just about everyone else invests heavily in businesses that do little to benefit the country and fail to support small business people.  It was ever thus.  I can remember my father who ran his own business from the 1950s, complaining in the 1980s that it doesn’t matter which party is in power, they all ignore the needs of small businesses.  The establishment seems mesmerised by huge corporations that exist solely to exploit the countries in which they happen to be based.

What would it be like to live in a society where the establishment truly valued local businesses?