Saturday, 4 March 2017

From Nationalism to Nationalisation

Last month, Hugo Evans asked what I would suggest as a programme to get us from nationalism to nationalisation. The short answer is that I'd focus on what he described as "functional finance state investment targeted at future energy". To explain the rationale for this choice I need to outline the relationship of nationalism and neoliberalism, as I see it, and to do that I first need to explain the difference between nationalism and nationalisation. That might appear like a category error, comparing a political and cultural construct with a method for organising and managing parts of the economy, but in fact they both represent fundamental attitudes about who constitutes "the people". Historically, nationalism and nationalisation haven't been mutually exclusive, but they have been inversely correlated in industrial societies. Nationalism tends to prosper in eras when the needs of the people are heavily subject to the market, whereas it declines in eras when more of those needs are met by services that are owned and managed for universal benefit rather than private profit.

The key then is public goods, most of which were a consequence of industrial modernity - e.g. municipal utilities, national transport and communication networks, and the capitalist demand for the state regulation of labour (public health, housing and education). The impact of modernity explains the difference between the liberal nationalism of the early to mid-19th century, which projected the nation as in opposition to supra-national monarchies and whose socio-economic premise was the primacy of private property and the superiority of the market, and the nationalism of the period between the late-19th century and WW2, which sought to re-establish an organic sense of the national community in an era distinguished by rapid urbanisation and thus the profusion of public goods. Nationalisation, as a method of socialism, argued for the primacy of common ownership and the superiority of planning over the market, however this wasn't simply a continuation of the old argument from the Diggers onwards for the common ownership of the means of production but an expanded argument for the common ownership of public goods. In other words, both nationalism and nationalisation are responses to industrial capitalism and the growth of those goods.

The essential antipathy of the two stems from the fact that public goods are non-excludable (i.e. open to all) and non-rivalrous (i.e. one person's use doesn't limit another's access). This doesn't imply abundance or ease of access, as anyone who experienced the 70s or early 80s would confirm, but the absence of discrimination on the basis of personal attributes. In contrast, nationalism believes that rights and entitlements should be dependent on personal qualifications, whether that be in the form of a passport or a yellow star. Some public goods, such as roads, may be publicly owned under nationalist regimes, but the use of nationalisation as a policy to promote nationalism is rare outside of the short-term expropriation of foreign-owned assets. In practice, nationalist regimes prefer to privatise state industries and develop a clientelistic relationship with domestic capitalists. In other words, the focus of state interference by nationalists is on moulding the people rather than adjusting the relations of production.

The nationalisation of strategic industries, many of which had little direct impact on the public, and the reliance on central planning directed by the state were features of actually-existing nationalisation in Western Europe during les trente glorieuses, however these were often contingent (e.g. the demands of postwar reconstruction or industrial consolidation that the market failed to provide) or the result of a conservative apparatus being absorbed by a state wary of workers' control (e.g. the persistence of old management in the NCB). The neoliberal drive for privatisation in the 1980s initially focused on these tactical nationalisations, not only because they were more vulnerable to the charges of inefficiency and under-investment but because they offered an easier route to normalising the idea of private provision ahead of the more fraught privatisation of public goods. The shift of focus to the latter in the 1990s marks the point at which modern nationalism gains political traction. This is not mere coincidence but reflects the promotion of national integrity and scarcity in political rhetoric.

The cost of effectively policing entitlement to public goods is high. For example, the NHS drive to bill foreign users will almost certainly be a failure relative to its ambitions, and could even cost more than it recoups, while trying to reclaim public subsidies for transport use by foreigners is a non-starter. This difficulty encourages policing of the perimeter instead, hence nationalism in the era of the welfare state has become increasingly obsessed with border security and residency rights. Where once nationalism was aggressive in expanding territory to absorb communities that included both claimed members of the "volk" and others, today it tends to be defensive and even willing to countenance the exclusion of areas within the heart of the nation state. The contemporary trope of the "no-go area", popularised by right-wing media outlets such as Fox News, riffs on traditional ideas of segregation, from the medieval ghetto to Apartheid, in which specific areas are defined not just by their inhabitants but by the withdrawal or limited provision of public goods. The initial political demand is not that these areas should be reclaimed or cleansed but that they should be denied public subsidy. Though "blood and soil" still motivates the ethno-nationalist core, it is not what gives political nationalism its modern prominence.

The nation is becoming an increasingly virtual concept, rather than one strictly co-terminus with a land, which reflects not only the diversity and dispersal produced by modern migration and integration but also the normative impact of the US right, with its history of segregation through zoning and its rhetoric of "welfare queens" and "government handouts" to favoured minorities. The history of the European right over the last 70 years can be thought of as a shift from warfare nationalism to welfare nationalism under American influence. The integrity of the nation is no longer simply a matter of ethnic or cultural homogeneity, despite the attempts by ethno-nationalists to construct a supreme antagonist out of Islam, but a question of entitlements in respect of the provision of public goods. This has produced an ideological cleavage on the right between conservatives contemptuous of all welfare and nationalists insisting on the prioritisation of certain types of welfare for the "decent people" who constitute the nation. This has an obvious class bias, so schools and health are good while unemployment benefits are bad, which allows conservatives and nationalists to find some common ground berating the lumpen elements of the "white working class".

The increased international movement of people obviously plays a part in this growing concern with security and national integrity, but so too does the growing importance of public goods in an advanced society. This is the result of three developments: advances in technology that create new public goods (or expectations that they should be public goods), such as broadband access or new medical treatments; the increased utilisation of existing public goods (more years in education, more years in hospital or care); and the secular increase in the dependency ratio (those not working versus those who are), which means a larger percentage of the population conscious of its reliance on public goods such as the NHS. Since the 1980s, the neoliberal state has insisted that public goods are in limited supply. This is a claim that was first justified by "crowding out" (we must curtail public services to allow private enterprise to thrive), then by the need for market optimality (New Labour's "what works") and now by the need for permanent austerity. The persistent message is that we, the atomised public, are in competition for scarce resources.

This is most obvious in the area of healthcare, not just because of the sharp increase in dependency (more elderly and more chronically ill) but because the NHS has always been characterised by two features: its national scope and its implicit rationing (the rightwing media's obsession with expensive cancer treatments leverages this to promote rivalry and thus competition). That this gives rise to contempt for the disabled or those assumed to be guilty of self-indulgence (e.g. the over-weight) is repellent but rational within the confines of a narrative of scarcity: the disabled and morbidly obese will place proportionately greater demands on the NHS. What isn't rational within this narrative is xenophobic resentment: the belief that immigrants get more than their fair share and are therefore denying resources to natives (on average, they are net contributors because they are more likely to be working and not chronically ill). This irrationality is not just about the convenience of "the other" as a scapegoat but about the growing identification of beleaguered public goods as attributes of nationality during an era when traditional characteristics (ethnicity, religion) have become less salient.

It is for this reason that we can say that nationalism is a product of neoliberalism and not just of austerity. More specifically, it is a product of the assault on public goods rather than any more general promotion of the market. This means that reversing the growth of nationalism does not require the wholesale dismantling of the neoliberal state or reform of the broader economy, it simply requires the reconstitution of public goods as non-excludable and non-rivalrous, thus making national integrity and scarcity less relevant to people's everyday lives. This doesn't just mean ensuring adequate capacity to avoid divisiveness, but advocating universal provision as being in everyone's interest for reasons of effectiveness and efficiency. To this end, we should be selective in our priorities for nationalisation. Most people's leading candidate would be health and social care (i.e. integrate, reverse privatisation, adequately fund), however I'd suggest that another area should take the lead for psychological reasons.

The biggest public good of all is the environment and it faces a clear and present danger in the form of climate change, the largest contributor to which is fossil fuels used in energy production. We know that climate change cannot be adequately tackled by the free market, even when heavily regulated by the state. Profit will incentivise destructive commercial activity beyond any safe limit while resistance to regulation will ensure that negative externalities continue to be subsidised. Practically, switching to a low or zero-carbon energy production system requires central planning and thus comprehensive nationalisation of power generation and supply. The psychological value of this would be threefold: the expression of the power of nationalisation through the dramatic reordering of an entire industry for the common good; the universal impact, because the vast majority of us pay energy bills; and the high probability of tangible benefits, e.g. demonstrable reductions in CO2 emissions. A focus on the environment has the advantage of defining the scope of public provision as the whole land, thereby undermining the narrative of internal segregation, and it also emphasises quality over quantity, so scarcity becomes a second order issue. For this reason I'd recommend introducing a land value tax as an explicit environmental charge that could cross-subsidise energy bills during transition.

Renationalising health and social care should be done, but we ought to recognise that this would be less dramatic (given the limited privatisation accomplished to date and that fixing PFI is an accounting exercise), less evident to many (i.e. it is the sick and elderly who would disproportionately realise the benefits), and less likely to deliver demonstrable gains because of an ageing society and the structural inefficiencies of a labour-intensive service. For similar reasons I'd also pursue rail re-nationalisation with less urgency than the reordering of the energy sector. Rail doesn't offer the same potential for success because the fundamental challenges are to do with capacity versus a spatially-imbalanced economy, so optimising the railways will take longer than converting to green energy, plus the major beneficiaries would be middle-class commuters. What I would recommend, as a side-order, is the nationalisation of car insurance, not only because it would be relatively easy to do and would deliver immediate cost savings, but because it would be a dramatic demonstration of the power of nationalisation that would affect most people.

Liberals tend to frame the contemporary growth of nationalism as the aggregate of individual responses to economic stress since 2008, often citing the parallels with the 1930s. While an economic crash can provide nationalists with a narrative opportunity (elites, traitors etc), it tends to amplify an existing trend rather than create an inflexion point. Thus the nationalist revanche of the 1930s is inconceivable without the nationalism of the first two decades of the century, while contemporary nationalism starts its ascent in the late-80s / early-90s and owes more to globalisation and neoliberal hegemony than Lehman Brothers. The liberal attitude is rooted in religious tropes about individual weakness and temptation in the face of adversity, which reduces social formation to the madness of crowds. It ignores the communal dimension: that popular nationalism (as opposed to the minority interest of programmatic racism) is a product of how we envisage ourselves cooperating with others, hence the importance of public goods. To defeat xenophobic nationalism you need to talk the language of community, but in terms of our common interests and basic human rights rather than our cultural heritage or exclusivity. The solution to nationalism is nationalisation.


  1. Herbie Destroys the Environment5 March 2017 at 10:18

    I don’t think you have addressed anything here to be honest.

    Where is the agency for all this? What does central planning actually mean? Does it mean the same goods are produced and in the same way? Who decides what goods are produced? And given we will have ‘central planning’ why are you even talking about nationalisation?

    I suspect, and I may be wrong, that when you say,

    “Practically, switching to a low or zero-carbon energy production system requires central planning and thus comprehensive nationalisation of power generation and supply.”

    You really mean a mix of markets and nationalisation. If not why do you see fit to talk of central planning on the one hand and nationalisation of power generation and supply on the other?

    I mean are beds and washing machines not non-excludable (i.e. open to all) and non-rivalrous (i.e. one person's use doesn't limit another's access) in an era of mass production? And are public goods non-rivalrous anyway? Ask a Palestinian and you may get a different view of things. I guess for an article that seeks to move away from nationalism it still clings to the Eurocentric view! As if little old Blighty is an island that can deal with climate change with no regard for what happens at the periphery!

    Given your definition of central planning, which appears to amount to nothing more than giving the government a little more responsibility, how will your schema even begin to address the issues around the environment? You can’t nationalise utilities and then somehow expect the problem to be resolved. You can’t tackle the climate crisis without addressing how every commodity is produced. That project requires more than tacking how energy is produced, it requires the complete dismantling of the capitalist system, which is driving straight for the cliff edge and ignoring all the warning signs! And given it is a system of accumulation, accumulation, accumulation, what else can it do? Well meaning far leftists will be as impotent as well meaning liberals if ‘central planning’ is the sum total of their ambitions!

    Now we come to agency. Who will carry through with the work that needs to be done? Given the debasement of the working class, something you seem to be in total denial of and utterly oblivious to, what can fundamentally change? Even if you wanted to change society you wouldn’t be able to because of the cultural crisis we are facing and the current state of the working class. Any leftist worth their salt should be alarmed by the state of the working class; given it is the only agency capable of bringing a post capitalist society to fruition in any sort of satisfactory way.

    No solution is possible without addressing the cultural crisis. All you will ever be able to do is tinker with top down non solutions. We have had well meaning liberals in government all over the advanced world and their efforts were at best meagre, in reality the problem has simply got worse.

    These unsatisfactory solutions will inevitably lead to some sort of authoritarian reckoning, which itself will provide no solutions. Is Trump the sign of that authoritarianism? I don’t think so. I think it is another sign of the cultural debasement. The authoritarian solution is yet to enter the stage, though the stage is being built. It won’t just be the right or the nationalists who will be to blame for the authoritarian solution, well meaning liberals and in denial leftists will have to take their own share of the blame.

    We are living in deluded times. It is one thing to imagine a better future. But what distinguishes the Utopian thinker from today’s milieu is that for the right we are already living in the perfect world, the cream rises to the top, everyone gets their just deserts, the market is fair, for the left we only need deal with structural issues and the rest falls into place. In other words the Utopian imagines a better future, while today we imagine a better now!

    On that note we haven't had an Arsenal article for a while! :)

    1. HDtE,

      I need to better define what I meant by "central planning" in the above. I don't mean a Soviet-style command economy, in which every input and output is subject to a single plan, but the industry-wide coordination that was common in the postwar era. In other words, "nationalisation of power generation and supply" would cover electricity generation and electricity and gas supply. It would be "comprehensive" in the sense that the old ECB and British Gas Corp were: serving both business and home users.

      I'm not suggesting that the UK can sort out climate change on its own, but that we have a moral obligation (to everyone on the planet) to do what we can within our own area of control. Tackling climate change will ultimately require action across the entire economy, from agriculture to consumer durables, but as the single biggest contributor to the problem is CO2 emissions arising from the burning of fossil fuels, we can make the biggest impact by starting with energy generation.

      Beds and washing machines aren't public goods because we have not decided that they should be and that therefore the state will make them available at cost to all. In other words, what makes something a public good is a political decision, not any intrinsic attribute. This is why separate instances of a good can be both public and private, e.g. a park. Public goods presuppose the existence of a public. This is why Thatcher's claim, "There is no such thing as society, only individuals and families", is central to the rationale of privatisation.

      To advance privatisation you eventually have to challenge the need for public goods. This means eroding the concept of a public other than as an expression of cultural norms, which in turn feeds nationalism - i.e. the cricket team we support becomes more important than the bus service we all use. Nationalism treats remaining public goods as sites of contest, hence the support for segregation and conditional supply. Your aside about Palestinians is precisely the point I'm making.

      Re your question "Given the debasement of the working class, something you seem to be in total denial of and utterly oblivious to, what can fundamentally change?" I admit that I do deny the working class is "debased", because I consider that to be a reactionary trope (the "left behinds" and "benefits street" bollocks) that is unsupported by any evidence. I am genuinely baffled by the "cultural crisis" you refer to. What does that mean?

      The working class - which I take to mean all who don't live off capital, so it includes most of the "middle class" too - is growing in number, absolutely and relatively, both globally and nationally, due to the continuing concentration of capital. It is better educated than it has ever been, but also more uncertain in its class consciousness because of the conditions of modernity. This includes false consciousness and the negative workings of the contemporary labour market, but it also centrally depends on the erosion of the idea of a public with shared needs and interests.

      This is why public goods are important and why nationalisation is central to the retreat of nationalism. Taking over the energy sector isn't a panacea, but it would be both a good in its own right (i.e. tackling climate change) and an emblematic commitment to the revival of a public space in which the pretensions of cultural class and the divisiveness of nationalism were marginalised.

      PS: I thought I might wait a couple of weeks for the next Arsenal post, on the off-chance that a good result might turn up. I reckon we might have a chance against Lincoln City.

    2. Herbie Destroys the Enviornment5 March 2017 at 14:04

      That is exactly what I thought you meant by central planning and is what I was critiquing. Half arsed solutions are just that. There is no solution within the confines of capitalism. The liberals were well meaning but they were always doomed to failure. That failure can only lead to the sort of tensions that beget Trump. At least trump has logic where the well meaning liberals have none. The liberals say let us introduce policy to cut carbon omissions but the affect is to increase carbon omissions just by less than if the policy had not been adopted! At least Trump says, forget climate change, this stuff is hampering production, let us just cut the red tape and get on with it. At least within his lunacy is some sort of acknowledgement that the liberal position is absurd., and some acknowledgement of the economic system that we are actually living in.

      The answer to climate change isn’t to pretend there is this thing called energy and then there is the rest of the economy. Energy is the thing that the whole economy is founded on; hence the advanced nations have a higher carbon footprint than the developed nations. Dealing with energy and leaving the whole consumer society alone is an absurd solution.

      You say we should do something to play our part in tackling the crisis. How about, rather than nationalising energy we reduce the carbon footprint of every individual by half, i.e. something meaningful. This will require more than simply central planning of energy, it will require a revolutionary and fundamental change to the way we live and organsise our lives. A simple dialectical resolution will not suffice for this task I am afraid. Though what you propose doesn’t include any kind of antithesis.

      You and large sections of the left are simply not serious about the challenge ahead.

      What cultural crisis you ask. I would say Brexit was a reflection of it. Call it the age of unreason. Where science is clear about the perilous nature of the climate problem the vast, and I mean vast, majority of the public simply do not care, couldn’t give a shit, are too preoccupied with carrying out their roles as obedient drones and consumers. Why, given the seriousness of the problem do people insist on ignoring it? I regard it as a combination of debasement based on decades of media manipulation, teaching people to be obedient and unthinking and the separation of people from decision making. So an organisational problem. Add into this mix total hostility to immigrants and a total lack of looking at anything conceptually.

      Look at 24 news, you would given the fact they have 24 hours and 7 days a week they would be able to fill some of that time with something half intelligent but no, it is witless propaganda, with breaking news strap lines aimed at people with the attention span of a goldfish who simply consume this crap without any thinking.

      Look at the most popular newspapers, the garbage tabloid feeding bile day in day out.

      There is no resistance whatsoever. None, period. I would go as far to say that there is nothing beyond consumption in one form or another. There is little or no form of self organisation among the working class other than maybe their kids football teams. If we had a socialist revolution tomorrow it would fail miserably because the working class are not ready for it.

      Now some of the above may be grounded on economic foundations, but I look around and I see a cultural crisis.

      When you ask what cultural crisis then all I can say back to you if no cultural crisis then no climate crisis.

      So I have to say to you, what is this climate crisis you talk about?

    3. Our personal carbon footprint is a statistical average: the total CO2 of a nation state (the level at which it is easiest to calculate) divided by the population. The most effective way to reduce it is not a proportionate cut in every individual's output through lower consumption, which is a wholly unrealistic proposal, but a reduction in the most concentrated outputs. By order of size, the biggest sources of emissions are electricity production, transport, industry, shops/homes, agriculture, forestry and waste.

      You could make an argument for rationing certain types of consumption, such as meat or imported fruit, or the number of household electrical devices. This would have the benefit of being socially progressive (i.e. the rich would forgo more), but it would also focus popular discourse on a trade-off between the liberty of personal consumption (which is immediate and visible) and the protection of the environment (the damage to which isn't as immediate or visible). There is a reason why this already happens to be the preferred strategy of climate change deniers.

      Converting to green energy seems to me to be a lot more achievable than getting every individual to cut their consumption of commodities and services by half.

      I disagree that we are in an age of unreason. If anything, rationality continues to advance, hence the secular decline in religion and the cultural primacy of data (however bastardised). I'd even go so far as to say that the burgeoning market for fake news and conspiracy is a direct product of this advance, being in part a nostalgic recuperation of the tall tales of rural idiocy.

      You claim that the vast majority of people don't give a shit about climate change, but repeated polls show that the vast majority are concerned (to varying degrees) and believe it to be largely man-made. It would be better to say that many people feel powerless in the face of such a systemic threat, and I'd attribute that in no small measure to the enervating effects of privatisation and the associated atomisation of society.

      I don't disagree with your description of the crapness of contemporary culture, from tabloid xenophobia to TV stupidity, but that doesn't constitute a "crisis". It isn't even new. In contrast, climate change is a crisis, and one that is happening at breakneck speed relative to the history of humanity, let alone that of the planet.

  2. You have some very good points here.

    My fear is that socialisation of any kind has become a very leftfield idea because the public provision of industries and services is something that the state and mainstream politicians have been shying away from since the 1970s. The problem for them is essentially a political one, that 'collective consumption' opens issues to broader political involvement and leads to popular demands over funding and levels and standards of provision. As a result, it can develop problems of 'governability' for elites.

    Thus even though public spending and state intervention are at levels equivalent to those of the 1960s and 1970s, the state has done its best to insulate itself against the politicisation of issues relating to collective provision, and to avoid the responsibility for problems as much as it can.

    I feel it will take an unprecedented level of public revolt to change this situation.

    1. You are quite right that nationalisation is problematic for the political establishment precisely because it substitutes public interest for managerial discretion, which means politicians cannot offload their social responsibilities by an appeal to technocracy. That much is painfully obvious in the continuing saga of the NHS. Thatcher's mantra "Managers must be allowed to manage" was clever because it appealed to the bureaucracy of the public sector as much as the entrepreneurs of the private sector.

      I chose the energy sector precisely because it has the potential for an "unprecedented level of public revolt" in respect of climate change. Of course, the danger is that the revolt comes too late in the day. My pet project to nationalise car insurance owes a lot to the idea that this could shift public opinion, not least because it is so left-field that I'm not sure the establishment would know how to counter the proposal.

  3. Thank you very much for responding to my earlier question. As Igor says above, this is in part a governability issue, rather than a technical one. Under nationalism it appears scarcity is operating not as a market signal to call forth new private provision, but as a way presenting outcomes as market driven and hence in a certain sense non-arbitrary and so less likely to engender resentment. Market rule of law: Fiat justitia ruat cælum. But as you half point out, 2008 was not an inflection point, but rather a blow to that rule that is yet to work itself out. Meanwhile, ‘the persistent message is that we, the atomised public, are in competition for scarce resources’, may be a message, but it’s being delivered in person, as relatively low rates of investment in public goods (private or public) result in per-capita capital dilution.

    Is there not a tragic irony to how this came about? Your argument that the collective provision of public goods is inversely correlated with nationalism is, for example, lent anecdotal support by the history of the municipality built Latchmere Estate in Wandsworth, where streets were named after enemy commanders in the Boer War.

    But in a recent LRB article, Tom Crewe mentions how this municipal provision was reorganised at joined up in the nationalisations of 1945, which may have been necessary for electricity but, consequently, made the utilities easy prey for the second round of privatisations you mention above.

    I fully agree that energy is the way to go forward, partly because it’s so well placed to shift the Overton window for future nationalisations, and also because our survival depends on it. My fear is that the current gov’t is not sufficiently blind to the issue to give us any helpful ‘blackouts’. Instead they’ll throw up gas power plants at the last minute, fuelled with the gas from the new fracking fields they’re busy opening up. It’s hard to see how the right can screw up badly enough to get the sack, even with Brexit.