A windfall tax on utilities?

One of the sad things about the past thirty years or so is how liberal ideologies based around the market have taken over public life. One feature of this is an unstrategic, reactive position on the part of those who inhabit 'the left', in which posing is frequently more important than saying what you mean or responding to evidence.

One recent example of this is the response to the news that privately owned gas, water and electricity monopolies in the United Kingdom are raising prices. The monopolies claim, with some justice, that world prices and the need to invest as well as to reward shareholders are primary factors in the inflation of their prices.

I do not fully trust the catholic communitarianism I am heir to. It assumes that businesses can be social entities, and that they can be run on a community basis. I think that is probably true of cooperatives, and of charities. I have to reflect, however, that charities are some of the most ruthless and money-driven organisations going, in some instances.

Businesses are there to make money. That is their function. Businessmen exist to improve the lives of themselves and their dependants and not only do they not have to really care about their employees, social responsibilities are in some senses not their concern.

If you want a publicly necessary monopoly to deliver public goods, and to plough profits into investment or lower prices, you, as a member of the public, should want some common body to own it.

A windfall tax is a get-out for people who do not wish to accept this truth, or who are scared in the modern environment to embrace it. You don't have to be socialist to do so; in fact, as the past few years and all the soi-disant socialists I have met have told me, I am not. Nor are the other people I keep meeting who want publicly owned railways, a publicly accountable police force--not council parapolice-- with fining and detention powers, public waste disposal, publicly owned airports, and publicly responsible utilities.

Windfall taxes on utility companies would just be passed on to those who pay for energy. It is dishonest to try and make a private company something it is not. Private companies could deliver education, private universities are amongst the best in the world, and some private companies are better at administration than the state.

Yet, when Downing street is itself fleeced for its website; when no sane private company would really want to operate Heathrow on the terms the people want; when utilities are a natural monopoly run for private profit; when vast amounts of private information accumulated on pain of criminal punishment are handed to expensive private bodies; when mad PFI schemes are endangering military volunteers, and costing billions for decades to come; when railways clearly can't be run as private bodies without customers being fleeced and rendered impotent; when government ministers fall over each other to be sponsored by companies at conference that will soon give them jobs in return for legal monopolies, why do people dare to say 'oh, all we should do is tax utilities once-off, and that'll prove us radical?'

Real radicalism would be to have socially accountable, statutory organisations that put profits back into services run by, for and with the public. Not organisations run by our defunct political class, I might point out, but accountable publicly to their users and not their shareholders.

That's why I am against windfall taxes, and why I have helped found The Campaign for Public Ownership, the website and accounts of which will be live very soon. Join me, if you've had enough.

Comments

Neil said…
Hi, just thought I'd point out that Manchester City Football Club is now a state-owned business. Albiet the state of Abu Dhabi...
Martin Meenagh said…
Hi Neil

Thanks for the comment. I appreciate it.

I know nothing about sport. I know that the appearance of knowing nothing hasn't stopped me holding forth before, so the topic won't now!. Isn't foreign ownership of football companies now a very large part of a game dependent on television contracts from globalised media companies?

States associated with oil and finance have been transferring their income into assets outside of their countries for some time--it's almost as though they could see the economic writing on the wall that all our 'analysts' kept quiet about.

This is also a world in which of 'sovereign funds' are growing. These are instruments of state power--we won't get one till its far too late--that are used to build up a reservoir of income and investment for countries. They are also being used to advance an agenda in commercial law of displacing the law of England and Wales (which is very favourable to international business and which they all like using in contracts) with 'Islamic financing' options. This is the foundation of a future cultural agenda, and you don't have to be some Marxist materialist to see it coming.

It isn't just football clubs that are being bought; huge amounts of property in Chelsea, for instance, and the greatest part of large new developments, as far as I can see, seems to be owned by foreigners.

Our response? Our politicians would sell the air we breathe if they could, and especially if they could sell it as proof of 'common sense/realism/any other excuse to truckle to the super-rich'.

All the more reason to draw a line in the coming recession and to take companies into social ownership.

We could encourage with tax law a sort of company owned by members and responsible to them that existed for the purposes of playing a game....hmmm...they could elect directors and hire players for reasonable wages...what would we call these 'football clubs?' Have there been any examples of them in the past?

A dangerous idea obviously. We'll be reopening the pits next.