New Ideas Number 1- Public Ownership But Not As We Know It Jim

New Ideas Number 1- Public Ownership But Not As We Know It Jim

I promised new ideas when I started out on this blog, so this week I thought I’d make good on the promise. I want to set our briefly an idea for a new understanding of, or means of, public ownership. Or more precisely, my take on what is probably a well-known idea.

When we think of public ownership, too often we think of strikes, poor service, inefficiency or Ministers fiddling about with the decisions of managers, as Gerald Kaufman talked about in his great little book on How To Be a Minister. Or we think of images like these:

But I want to suggest that there is more to public ownership than coal mining or other giant monopoly industries, or great swathes of remote forest and upland. This website gives a pretty good (if standard) take on common ideas.

I also want to discount the traditional British form of public ownership, where we assume the state must own the property and take decisions on our behalf e.g. Brtish Steel, British Leyland, the forests estates etc. That leads to poorly thought through proposals to sell off public land by ‘passing ministers’ with too much power and not enough awareness of tradition and place, when proposed either at UK or Scottish levels.

I think the history of public ownership in the UK is very mixed, and has always been subject to passing political whim. Ministers will always be tempted to meddle in the running of businesses, either by second guessing management, or stripping out profit, or denying capital, or using price as a constraint on demand or by simply removing the competitive edge- managers know if they mess up the state will always be there to pick up the pieces. And so many right wingers want things to fail to justify privatisation. So, I’d say there are practical and theoretical reasons (1) to be cautious about the traditional form of public ownership in the UK, without ruling it out entirely of course.

I also don’t mean to say that the sort of mechanical socialism and Fabianism that dominated Labour and left-wing thinking for so long is the only way. But instead that of course that are many other means and forms of ownership- from the ancient world of estovers and pannage, to modern forms of common land and access , to Rochdale cooperative principles and mutuals.

But the problem with the traditional approach is that it tends to assume only two main actors- the private sector and the state, with no room for real members of the public. The problem with other forms of ownership such as common land, mutuals, co-operatives and others, is that either not enough people want the hassle of running the show themselves, or that they are too small to really affect trends, or that they are still subject to passing whims on taxation, regulation and incentives.

So What Is The Big Idea?

 So, enough with the throat-clearing and down to business. What is my idea?

My idea is simply this- that ownership of public assets should be transferred from the state to the public. More precisely, those who meet certain rules of UK citizenship will automatically become the owners of state assets. As owners they will have rights and responsibilities, and it will be for them as owners to decide on the future of major policy decisions including sell-off of local land, closure of facilities, or privatisation.

What do I mean by state assets. I mean firstly the transfer of all crown lands from the arcane fiction of the ‘Crown’ to members of the public. Not just that we would own (small shares in!) Buckingham Palace, but that we’d own the sea-bed, the foreshore, the airwaves and so on. Secondly I mean that at a regional and local level we’d own the roads, the railways, the land, the hospitals, schools, council buildings and so on.

Setting out one more time- whilst management of the assets would be vested in our representatives (and through them public employees)  as now, either at national, regional or local government levels, the legal ownership of the assets would be shared across UK citizens.

Now, we’d need some rules first of all about who qualifies. My suggestion is that anyone who has reached voting age and who is on the electoral register is entitled to a fraction of ownership and would be recognised as such. We don’t have to make ownership conditional on electoral registration of course but it might provide a boost to voting and participation in democracy.

Secondly, we’d need to define what rights and responsibilities such ownership entails. My view is that responsibilities are ‘civic’ in the sense of keeping up to date with trends and developments associated with the assets. And secondly that if a vote is called on something, one is required to participate. But I believe these responsibilities should be modest, whilst also empowering.

What does the idea mean in practice? Well, I’d suggest at local level that anyone on the local electoral register would be considered a part owner of the assets from all state bodies in the area- including government buildings, parks, roads, schools, forests, common land, hospitals and so on.

Secondly, it means that the managers of the assets- our current state-led pubic bodies, would take on a new role of stewardship, not the sometimes rather technocratic, aloof and arrogant ‘ownership to do with as we please on a change of political leadership’ approach we (too often) see. I believe for key local assets often at the centre of controversy- land sold off for new developments, planning decisions, closure of hospitals, that representative bodies will need to work far harder to secure agreement.

My idea is that according to some local ‘standing orders’ that define the limits of state authority and the circumstances under which change is allowed, that the state and local managers will need to be far more engaged in place, in community and in explaining and justifying decision making. We can imagine for example a proposal to sell off a school playing field where either all local people in the council area, or a defined subset ‘affected’ by the plans, will be able to demand, hold a referendum and defeat the proposal, perhaps much like a shareholder resolution can defeat the management of a company or send a strong signal on the desired direction of travel.

We can imagine consultative discussions held at national and local level with citizens (as owners) on the ideas a state entity is considering, before they are activated or indeed placed in manifestos. We can imagine a dedicated public body, analogous to the electoral commission, (the ‘Consultative Commission’ perhaps), taking national or regional or indeed local ‘rolling polls’ of the views of citizen-owners prior to an election campaign. We might find that citizens recognise a central hospital would be cheaper and more effective but want to keep their local hospital. We might find that citizens like keeping local job centres and tax offices or reject out of hand private companies running certain public functions.

One obvious issue to consider is the precise relationship between local and national decision making- but I think that can be overcome with enough thought. A second obvious issue is to define the circle of ‘affected’ people tightly enough so a local desire for action isn’t swamped by a national or regional push-back, whilst at the same time allowing meaningful and engaged citizens across a defined but not just hyper-local area. We would need to think carefully to avoid the problems encountered with the referenda-heavy, money-heavy policy and campaigning approach seen in California. We would need to look for ways for assets to be protected from a generation simply ‘cashing in’ as many did over the transfer of building societies from mutuals to private companies in the 1990s. 

 

Why Propose This? 

To me, this is a radically different proposal from standard common ownership. We are asserting the genuine power of citizens, as the owners of state assets, which, after all, their taxes and efforts have paid for. I hope it will improve the sense that citizens have of engagement with, and empowerment over, the political process.

I hope it would sharpen up the performance of state actors, across the education, council, health, environment, tax, social security and transport communities. I expect it would reduce the power of ideologues, winner-takes-all political administrations, think tanks and media moguls. I hope it would even reduce vandalism and disrespect for public property because after all, the owner in this case is the person considering the damage!

More broadly as well as linking ownership rights to voting and electoral registration, we could link it to the idea of a basic income, which I blogged on before. 

 

What Are the Downsides? 

Clearly I don’t have all the details worked out so much more work would be needed to translate this outline sketch into serious policy proposals. It may be that the idea isn’t radical at all, and is common in other countries (please let me know if it is!).

More work would be needed on legal definitions to ensure watertight ownership, and to define a ‘scheme of delegation and authority’ from local citizens to state entities. If we did take over Crown property, some more legal work would be needed to overcome centuries of daft constitutional showboating, overhangs and silly fiction.

More seriously, we’d need to undertake a large campaign of awareness raising to ensure people really did feel empowered and understood their rights and responsibilities. A crucial point as I mentioned above is to provide enough ’empowerment’ that a genuine local wish to prevent something occurring can be created, whilst avoiding a tidal-wave of NIMBY-style inertia and factionalism. But I see no reason why with enough care, such problems couldn’t be overcome.

 

Part of A Bigger Picture? 

 

Readers may have noticed that such a scheme, radical as it may sound, does not by any means tackle all of the fundamental issues facing us. Whilst I do believe it would go a long way to increase the sense of engagement with the state and empowerment that citizens feel, it only touches the surface of inequality issues.

In particular, it ignores the pattern and distribution of private ownership of resources- land, income and wealth, company shares, rental income and dividend etc. There are some fascinating ideas on newer forms of capitalism that I want to explore at a later date, centred around market socialism ideas.

To finish though , the real reason I think the idea would be worth exploring is back to my ideas on a fair, equal and liberal society:

‘It is fundamentally whether I feel I am an equal citizen of equal worth, with all the dignity, freedom and ability to execute my life plan that I expect.’

In that blog I set out a principle for just such a society which I think is relevant here:

Principle 5 The basic structure of society should be designed such that power is dispersed politically at multiple levels and across multiple geographical areas, consistent with the achievement of other principles and goals

I believe that we simply must go beyond discussions about tax and spend wealth transfers, about public vs private and get to a point where citizens really do feel equal, empowered and ‘all in it together’. I hope the idea I’d proposed might have some merit on the journey towards that ambition.

Thanks for reading.

 

Notes

(1) John Roemer A Future for Socialism (1994) Verso Books ISBN-13: 978-0860916536

 

Modern Life is Rubbish- Ten Ways That Poorer People Are Treated Unfairly In the UK

Modern Life is Rubbish- Ten Ways That Poorer People Are Treated Unfairly In the UK 

‘Em… Hang on a minute.’

 

I am conscious that, to date, many of my posts have been rather long, and rather abstract. So this time I wanted to say something more tangible- about how it seems to me that modern life in the UK is tilted towards unfairness if you are poor. Let me list 10 obvious ways, and then draw some conclusions.

Unfairness Number One- Energy Costs and Energy Transition

If you are poorer, you are more likely to have to use a pre-payment meter, which costs you more. You are also much more likely to be fuel poor, unable to heat your home properly, possibly suffering bad insulation, bad heating and more expense. And to add insult to injury, any taxes you pay or any surcharge on your bills to allow the much needed transition away from fossil fuels to low carbon and renewables, is unlikely to benefit you as lower income families don’t have the resources to hand to take advantage of subsidies home renewables.

 

Unfairness Number Two- Banking,Savings and Money 

The tendency is that poorer people will pay more for credit and loans, sometimes a lot more, and even if it is for basic services. This report from Save the Children  and this report explain in more detail- this table is from the Save the Children report:

Either because you don’t have the internet and/or can’t pay by direct debit, or your credit history is affected by poverty, or because you can’t afford large one off-purchases, if you are poor the evidence suggests you pay a lot more for big-ticket items. Oh, and your pay-as-you-go mobile service will be more expensive too. You may live in a less desirable area so you risk you’ll pay a lot more for insurance and car insurance too. Though action has been taken to cap the worst excesses of pay day lending, you’ll still end up with a much more poorer deal on credit and loans.

 

Unfairness Number Three- Access to Wealth and Investments 

Because you are poor, chances are you will have no or little savings and no or little wealth. That means that any returns you do make will be modest, whether that is on your savings account, modest private pension or dividends. You’ll likely not have a house of your own so the natural growth in housing value won’t accrue to you. Unlike rich people, you can’t afford investment advice to take advantage of complex investment opportunities. Even if you could, your small pot means you can’t compete with the much higher returns that people with capital secure.

 

Unfairness Number Four -Wealth and Your Start (and end!) in Life 

The last Labour government in the UK introduced Child Trust Funds, a form of asset based policies. 

It seems to me this was a great idea- it recognised that one glaring unfairness in life is that richer people often have more choices and do better because they have independent wealth, and that perhaps the state could start to rectify this with a savings based approach. Sadly, the coalition government scrapped the policy in 2010.

So, no only do some people start out with far more advantages in life, they can use their wealth and capital to secure even more advantage. Often the tax system rewards them- from higher rate tax relief on private pensions, to capital gains tax treatment, to (now much more generous) inheritance tax treatment. So, just so readers understand- not only do poorer people have no savings or wealth, but the tax system and lack of asset based policies mean any tax they do pay partly goes to subsidise tax reliefs for people who have way more wealth and opportunity. And the chances of a poorer person ever ‘catching up’ are very modest indeed.

 

Unfairness Number Five- Food Availability, Cost and Quality

Apparently food poverty affects 4 million people in the UK.

‘Food poverty is worse diet, worse access, worse health, higher percentage of income on food and less choice from a restricted range of foods.  Above all food poverty is about less or almost no consumption of fruit & vegetables’
Tim Lang, Professor of Food Policy at City University.

In a nutshell, if you’re poor your food costs you proportionately more, you have less choice, lower quality and worse health outcomes as a result.

Speaking of health…

Unfairness Number Six- Health Inequality

If you are poorer, you are far far more likely to be less healthy over the course of your life, to suffer higher burdens of diseases and to die younger. The gap between poorer people and richer people on health is wide and widening. In the interests of brevity I won’t dwell on this, but the statistics are shocking and unacceptable. 

Pioneering work in Scotland also shows how poverty affects your psychological well-being, with increased anxiety and negative physiological reactions.

Which reminds me, it’s also worse for you environmentally…

Unfairness Number Seven- Poorer Environment 

Dear reader, I don’t have the time to assemble the evidence I should here- perhaps you will accept my special pleading that as an ex-senior manager for a national environment agency, I do have some understanding in this area. For now, I’ll rely on a wikipedia definition of environmental inequality 

It has almost always been the case that the richest lived in better environmental conditions than the poorest and things have not really changed. Think how, in the days of really bad environments full of fumes, and odours and fogs, richer people lived upwind of the prevailing wind, or on raised ground. Sadly things have not changed as much as we might have hoped. If you are poorer, you are more likely to live next to a factory, to a noisy environment like a road, to live with poorer air and water quality, you’re less likely to live next to green space (in urban environments), you’re more likely to live in areas that flood, more likely to live next to incinerators or landfills, and more likely to have ‘disamenities’ such as graffiti, dog fouling, litter, vandalism and derelict land in your local environment.

 

Unfairness Number Eight– Access to Education

This blog is already rather link heavy, so let me just state that the evidence is that you are more likely to go to a poorer performing school if you are poorer, less likely to see a societal valuing of and governmental focus on your technical and vocational skills if that is your path you want to chose, more likely to incur the highest debts if you are a poorer student in Scotland, and much less likely to go to University if you are a poorer student anywhere in the UK. In Scotland if you are a poorer, older learner, you’ve also seen severe cut backs in part-time places for life long learning. Overall, in a modern economy and life-style where education is the key to many things, if you are poorer you’re less likely to be able to access it and its quality may be poorer.

 

Unfairness Number 9- Access to Legal Services 

A key means to play a full part in society is the ability to defend your reputation, access courts for family disputes or government maladministration, have the ability to right wrongs done to you, and take action the things that matter to you and your community. One might call that access to justice. Sadly, if you are poor, your access to legal advice and the courts is likely to be much worse than a rich person’s. And sadly, that ability seems to be declining. 

 

Unfairness Number 10- Differences in How The World of Work and Business Treats You

For many well off people, it seems self-evident to them that they need a stable environment, the ability to have a stable legal and governmental system to plan their investments around, and proper incentives to work and to keep a fair share of their income. For some reason though, that position is reversed for how we manage to treat poorer people- from punitive and ineffective welfare sanctions, to lack of workplace rights and security to zero-hours contracts, poorer people tend to form the bulk of the precariat.

 

Conclusions

When I started to think about this, I must admit that initially I thought about just pre-payment meters. But as my list shows, everything from the cost of your energy, to the quality of your food, to your mental health and life expectancy, and onto your access to legal services, education and stable work, is most likely worse if you are poorer.

Now, some on the right of politics may response by saying ‘look, it’s to be expected, no one wants to see poorer people do less well, but its to be expected- resources in life are a function of ability and the just rewards of the market and we should accept that and mitigate where we can’

Sorry, I reject that view for two reasons. Firstly, as I set out in my blog on societal risks, I believe that some of these risks are entirely foreseeable, a result of systematic problems, poor policy and lack of planning. I believe government has a duty to do something about them. As I said in that blog:

We are searching for things that the state owes an obligation to its citizens to address, across the full range of socio-structural, socio-technological and socio-cultural risks discussed above.

We are searching for things where the state has made decisions between options, and those decisions have consequences for individuals. We are looking for decisions and risks that violate basic rights, and where something can be done about that. We are excluding on the whole individual decisions where a choice was made and it didn’t work out. We are particularly looking for those risks that, absent substantial wealth and resources, it is difficult for an individual to foresee, to manage via self-help alone, and where reasonable efforts are  or have been already made by the citizen to address the risk.’

I think every one of those ‘unfairnesses’ that I list above fall into the risk categories I mention.

More fundamentally, I’m back to the basic structure of society and the principles of a fair and just liberal society. In my blog on this I set out principles to judge such a society, the most challenging of which is the Rawlsian difference principle:

‘Principle 2- Social and economic inequalities are to be arranged so that they are both:

(a) to the greatest benefit of the least advantaged, consistent with the just savings principle, and

(b)attached to offices and positions open to all under conditions of fair equality of opportunity.’

I don’t think anyone could read through that list of unfairness towards the poorer members of society and pretend that we are meeting this test. So, we need to do better- it’s a fundamental test of our claim to be a decent society and we are currently failing it. As ever, thanks for reading