To one sort of capitalist, the insecurity and chaos that Brexit will bring is horrifying. To the other, is it highly profitable
Rupert Murdoch, pictured in Washington DC in 2013. Photograph: Bloomberg
George Monbiot THE GUARDIAN
Tue 24 Nov 2020
Where there is chaos, the government will multiply it. Where people are pushed to the brink, it will shove them over. Boris Johnson ignored the pleas of businesses and politicians across the UK – especially in Northern Ireland – to extend the Brexit transition process. Never mind the pandemic, never mind unemployment, poverty and insecurity – nothing must prevent our experiment in unassisted flight. We will leap from the white cliffs on 1 January, come what may.
Perhaps, after so much macho bluster, the government will take the last of its last chances and strike a deal this week. If so, with scarcely any time for refinement, the agreement is likely to be rushed and bodged. In any event, pain will follow. Disruption at the border is likely to be felt across the nation.
So it is worth repeating the big question: why are we doing this to ourselves? I believe the answer is that Brexit is the outcome of a civil war within capitalism.
Broadly speaking, there are two dominant forms of capitalist enterprise. The first could be described as housetrained capitalism. It seeks an accommodation with the administrative state, and benefits from stability, predictability and the regulations that exclude dirtier and rougher competitors. It can coexist with a tame and feeble form of democracy.
The second could be described as warlord capitalism. This sees all restraints on accumulation – including taxes, regulations and the public ownership of essential services – as illegitimate. Nothing should be allowed to stand in the way of profit-making. Its justifying ideology was formulated by Friedrich Hayek in The Constitution of Liberty and by Ayn Rand in Atlas Shrugged. These books sweep away social complexity and other people’s interests. They fetishise something they call “liberty”, which turns out to mean total freedom for plutocrats, at society’s expense.
In unguarded moments, the warlords and their supporters go all the way. Hayek, for example, on a visit to Pinochet’s Chile, said he preferred a “liberal dictatorship” to “a democratic government devoid of liberalism”. Peter Thiel, the cofounder of PayPal and Palantir, confessed: “I no longer believe that freedom and democracy are compatible.” Last month, Mike Lee, senior Republican senator for Utah, claimed that “democracy isn’t the objective” of the US political system, “liberty, peace, and prosperity are”.
Brexit represents an astonishing opportunity for warlord capitalism. It is a chance not just to rip up specific rules, which it overtly aims to do, but also to tear down the uneasy truce between capitalism and democracy under which public protections in general are created and enforced. In Steve Bannon’s words, it enables “the deconstruction of the administrative state”. Chaos is not a threat but an opportunity for money’s warlords. Peter Hargreaves, the billionaire who donated £3.2m to the Leave.EU campaign, explained that after Brexit: “We will get out there and we will become incredibly successful because we will be insecure again. And insecurity is fantastic.”
The chaos it is likely to cause will be used as its own justification: times are tough, so we must slash regulations and liberate business to make us rich again. Johnson’s government will seek to use a no-deal or thin-deal Brexit to destroy at least some of the constraints on the most brutal forms of capitalism.
Housetrained capitalists are horrified by Brexit. Not only does it dampen economic activity in general, but it threatens to destroy the market advantage for businesses that play by the rules. Without regulatory constraints, the warlords would wipe them out. Like other august institutions of capital, the Confederation of British Industry warned that leaving Europe would cause a major economic shock. In response to these concerns, Johnson, while he was foreign secretary, made a remark that might previously have seemed unthinkable, coming from the mouth of a senior Conservative, “fuck business”.
Johnson’s government is what warlord money buys. It could be seen as the perfect expression of the Pollution Paradox, a concept that I think is essential to understanding our politics. What this means is that the dirtier or more damaging an enterprise is, the more money it must spend on politics to ensure it’s not regulated out of existence. As a result, political funding comes to be dominated by the most harmful companies and oligarchs, which then wield the greatest political influence. They crowd out their more accommodating rivals.
It isn’t just about pollution. Damaging enterprises with an interest in buying political results include banks developing exotic financial instruments; property developers who resent the planning laws; junk food companies; bosses seeking to destroy employment rights; and plutocrats hoping to avoid tax. It’s why we’ll never have a healthy democracy without a radical reform of campaign finance.
Understood in this light, Brexit is scarcely about the UK at all. Oligarchs who have shown great interest in the subject tend to have weak or incomplete ties to this country. According to Andy Wigmore of Leave.EU, the campaign was assisted by the US billionaire Robert Mercer. By far the biggest individual donors to the Brexit party are Christopher Harborne, who is based in Thailand, and Jeremy Hosking, who has businesses listed in Dublin and Delaware. The newspaper owners who went to such lengths to make Brexit happen are domiciled offshore. For people like Rupert Murdoch, I believe, the UK is a beachhead among the richest and most powerful nations. Turning Chile or Indonesia into a giant free port is one thing. The UK is a much bigger prize.
None of this is what we were told we were voting for. I see Nigel Farage and similar blowhards as little more than smoke bombs, creating a camouflaging cloud of xenophobia and culture wars. The persistent trick of modern politics – that appears to fool us repeatedly – is to disguise economic and political interests as cultural movements. Throughout this saga, the media has reported the smokescreen, not the manoeuvres.
This, perhaps, was the remain campaign’s greatest failure. It largely refrained from calling out the oligarchs whose money helped to persuade us to leave the EU. Any such charge would have rebounded on a campaign funded by the likes of David Sainsbury, Morgan Stanley and Goldman Sachs. When Dominic Cummings and others in the leave campaign claimed they were fighting “the elites”, they were partly right. In terms of funding, this was a battle between competing elites. So the remainers, fatally compromised by the money they had taken, instead became locked in a culture war they were bound to lose, confronting xenophobia with bromides about the benefits of integration. They failed to strike at the heart of the matter.
Brexit, treading on the heels of the pandemic, is likely to harm the lives and freedoms of millions of people in the UK. But it’s not about us. We are just caught in the crossfire of capitalism’s civil war.
Where there is chaos, the government will multiply it. Where people are pushed to the brink, it will shove them over. Boris Johnson ignored the pleas of businesses and politicians across the UK – especially in Northern Ireland – to extend the Brexit transition process. Never mind the pandemic, never mind unemployment, poverty and insecurity – nothing must prevent our experiment in unassisted flight. We will leap from the white cliffs on 1 January, come what may.
Perhaps, after so much macho bluster, the government will take the last of its last chances and strike a deal this week. If so, with scarcely any time for refinement, the agreement is likely to be rushed and bodged. In any event, pain will follow. Disruption at the border is likely to be felt across the nation.
So it is worth repeating the big question: why are we doing this to ourselves? I believe the answer is that Brexit is the outcome of a civil war within capitalism.
Broadly speaking, there are two dominant forms of capitalist enterprise. The first could be described as housetrained capitalism. It seeks an accommodation with the administrative state, and benefits from stability, predictability and the regulations that exclude dirtier and rougher competitors. It can coexist with a tame and feeble form of democracy.
The second could be described as warlord capitalism. This sees all restraints on accumulation – including taxes, regulations and the public ownership of essential services – as illegitimate. Nothing should be allowed to stand in the way of profit-making. Its justifying ideology was formulated by Friedrich Hayek in The Constitution of Liberty and by Ayn Rand in Atlas Shrugged. These books sweep away social complexity and other people’s interests. They fetishise something they call “liberty”, which turns out to mean total freedom for plutocrats, at society’s expense.
In unguarded moments, the warlords and their supporters go all the way. Hayek, for example, on a visit to Pinochet’s Chile, said he preferred a “liberal dictatorship” to “a democratic government devoid of liberalism”. Peter Thiel, the cofounder of PayPal and Palantir, confessed: “I no longer believe that freedom and democracy are compatible.” Last month, Mike Lee, senior Republican senator for Utah, claimed that “democracy isn’t the objective” of the US political system, “liberty, peace, and prosperity are”.
Brexit represents an astonishing opportunity for warlord capitalism. It is a chance not just to rip up specific rules, which it overtly aims to do, but also to tear down the uneasy truce between capitalism and democracy under which public protections in general are created and enforced. In Steve Bannon’s words, it enables “the deconstruction of the administrative state”. Chaos is not a threat but an opportunity for money’s warlords. Peter Hargreaves, the billionaire who donated £3.2m to the Leave.EU campaign, explained that after Brexit: “We will get out there and we will become incredibly successful because we will be insecure again. And insecurity is fantastic.”
The chaos it is likely to cause will be used as its own justification: times are tough, so we must slash regulations and liberate business to make us rich again. Johnson’s government will seek to use a no-deal or thin-deal Brexit to destroy at least some of the constraints on the most brutal forms of capitalism.
Housetrained capitalists are horrified by Brexit. Not only does it dampen economic activity in general, but it threatens to destroy the market advantage for businesses that play by the rules. Without regulatory constraints, the warlords would wipe them out. Like other august institutions of capital, the Confederation of British Industry warned that leaving Europe would cause a major economic shock. In response to these concerns, Johnson, while he was foreign secretary, made a remark that might previously have seemed unthinkable, coming from the mouth of a senior Conservative, “fuck business”.
Johnson’s government is what warlord money buys. It could be seen as the perfect expression of the Pollution Paradox, a concept that I think is essential to understanding our politics. What this means is that the dirtier or more damaging an enterprise is, the more money it must spend on politics to ensure it’s not regulated out of existence. As a result, political funding comes to be dominated by the most harmful companies and oligarchs, which then wield the greatest political influence. They crowd out their more accommodating rivals.
It isn’t just about pollution. Damaging enterprises with an interest in buying political results include banks developing exotic financial instruments; property developers who resent the planning laws; junk food companies; bosses seeking to destroy employment rights; and plutocrats hoping to avoid tax. It’s why we’ll never have a healthy democracy without a radical reform of campaign finance.
Understood in this light, Brexit is scarcely about the UK at all. Oligarchs who have shown great interest in the subject tend to have weak or incomplete ties to this country. According to Andy Wigmore of Leave.EU, the campaign was assisted by the US billionaire Robert Mercer. By far the biggest individual donors to the Brexit party are Christopher Harborne, who is based in Thailand, and Jeremy Hosking, who has businesses listed in Dublin and Delaware. The newspaper owners who went to such lengths to make Brexit happen are domiciled offshore. For people like Rupert Murdoch, I believe, the UK is a beachhead among the richest and most powerful nations. Turning Chile or Indonesia into a giant free port is one thing. The UK is a much bigger prize.
None of this is what we were told we were voting for. I see Nigel Farage and similar blowhards as little more than smoke bombs, creating a camouflaging cloud of xenophobia and culture wars. The persistent trick of modern politics – that appears to fool us repeatedly – is to disguise economic and political interests as cultural movements. Throughout this saga, the media has reported the smokescreen, not the manoeuvres.
This, perhaps, was the remain campaign’s greatest failure. It largely refrained from calling out the oligarchs whose money helped to persuade us to leave the EU. Any such charge would have rebounded on a campaign funded by the likes of David Sainsbury, Morgan Stanley and Goldman Sachs. When Dominic Cummings and others in the leave campaign claimed they were fighting “the elites”, they were partly right. In terms of funding, this was a battle between competing elites. So the remainers, fatally compromised by the money they had taken, instead became locked in a culture war they were bound to lose, confronting xenophobia with bromides about the benefits of integration. They failed to strike at the heart of the matter.
Brexit, treading on the heels of the pandemic, is likely to harm the lives and freedoms of millions of people in the UK. But it’s not about us. We are just caught in the crossfire of capitalism’s civil war.
• George Monbiot is a Guardian columnist
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