The rich don’t have socialism but the working class need it

September 5, 2014

“It’s socialism for the rich and capitalism for the rest of us in Britain” writes Owen Jones in an article in the Guardian on August 29.

Jones’ argument is based on the bailouts given to the banks and subsidies given to big businesses by the British government in the aftermath of the 2008 global financial crisis. These government bailouts allowed the banks to survive, but individuals suffered and received limited government intervention or support.

Jones gives other examples of “socialism for the rich”. The British government provided low-income workers with tax credits from 2004 to 2011. These tax credits, in effect, operate as a subsidy to bosses for low pay. It encouraged employers to hire workers without paying them a living wage, leaving the state to provide for their underpaid workforce. In the meantime, corporations were making record profits.

Another example is the £24 billion spent by the government on housing benefits to low-income earners forced to claim the benefit due to the rising cost of rent. This was a result of inadequate investment in public housing, driving low-income earners into the private rental sector.

However, the housing benefit acted as a subsidy for private landlords charging high rent, and a further subsidy for bosses paying less than liveable wages.

Jones explains the state of Britain’s public sector and describes it as a “funding stream for profiteering companies”.

An example is a company called Atos, which was hired to carry out work capability assessments. The National Audit Office said Atos had not “routinely met all the service standards specified in the contract”. The government had failed to seek “adequate financial redress for underperformance”.

People living with disability who needed support had their support taken away by Atos after being deemed “fit for work”. According to information reported by a Labour MP, 1300 people died after being placed in the “work-related activity group” and another 2200 people died before the assessment process was completed.

An additional 7100 people died after being placed in the group for those entitled to unconditional support, as they were too ill or disabled to work.

Jones has laid out a clear example of the contradictions of capitalism and has clearly debunked the concept of the “free market” as put forward by neoliberal ideology. It has become clear that big business and governments only support the idea of the “free market” when it suits them.

Big business and governments that serve them justify the cutting of red and green tape to benefit the “free market”, which will diversify services thereby improving our quality of life. However, as soon as these same businesses are “struggling” or their profits are marginally down for the quarter they demand government subsidies or threaten to take their business offshore.

Yet socialism cannot be simplified to state interventionism the way Jones does. Socialism is from each according to their ability, to each according to their needs, which is certainly not happening among the 1% in Britain or in any part of the world.

The rich do not have socialism, they operate under the same capitalist system like the rest of us. The difference is that they have a degree of control over the system due to their ownership of capital, power and influence over governments.

To this end, it is big business and government fat cats who profit by this system, while life is made harder for the rest of us.

[Sarah Hathway is a member of Resistance: Young Socialist Alliance and is standing in the Victorian state elections for the seat of Geelong.]

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