Friday, 11 March 2011

RBS Share-Out? Why Not?

Did I hear the early-morning BBC News right on Tuesday? I thought they said that the Liberal Democrats were proposing the redistribution of state-owned RBS shares among the whole adult citizen population. If so, it was the first evidence of the Lib Dem body still having a live brain since the coalition was formed. But the item was dropped from the news soon afterwards, so perhaps the BBC realised that they had been deceived by a few twitches in that some-time-dead corpse.

The proposal (if anyone actually made it) would have been consistent with the ideas about the Big Society circulating before the election last May. The redistribution of property, in the form of shares like this, bonds and all other kinds of assets, to individuals and communities, was the 'Red' part of Phillip Blond's Red Tory message, which David Cameron claimed to admire, and which might have supplied some kind of ethical justification for the devolution of collective services to the local level.

Instead, of course, the cuts - made in the name of balancing the budget - have facilitated the incursion of private firms, empowering these commercial forces, and enriching their already wealthy owners, not the general population. As Blond acknowledges in his analysis of Thatcher's privatisations, these weakened civil society and made individuals more insecure and vulnerable, in the name of the 'property-owning democracy'. The same trick is being played again.

It is much the same story in the case of Iain Duncan Smith's welfare reforms. Back in September, 2009, his Centre for Social Justice published a Report, Towards Welfare that Works, that recommended the partial integration of the tax and benefits systems to create 'universal credits' for all adults of working age.

In his Preface to that report, Duncan Smith argued that the enforcement of work conditions in benefits was impossible to justify unless incentives for available work improved. He promised that his scheme would achieve this aim, withdrawing benefits at a steady rate as claimants took paid work, making even a few hours of employment advantageous for them.
Instead, since he became Secretary of State for Work and Pensions the whole thrust of his reforms has been to cut benefit rates, remove eligibility from disabled people, and impose new sanctions on those refusing job offers, however disadvantageous. The incentives which are supposed to stem from his modified version of the CSJ's scheme will not arrive until some time after this punitive regime has been imposed.

A universal distribution of the shares acquired through the state bail-out of Northern Rock, RBS and Lloyds would signal that there remains a long-term prospect of the radical part of the Big Society programme becoming a reality. It would create a sort of 'Social Dividend' for all citizens, a bit like the annual payments made to all the permanent inhabitants of Alaska (in their case redistributing a small part of that state's oil wealth, in compensation for the hardships of living in that frozen wasteland).

This proposal has recently been canvassed as a part of the solution to the structural problems of employment and income identified in my last blog. If there really is going to be little chance for the new generation to develop careers, with prospects of incremental salaries, promotions and pensions, them they will need assets which yield reliable subsistence during periods of retraining or setting up a business of their own.

But this kind of redistribution would also make unpaid collective action to improve the quality of life in communities (a.k.a. the Big Society) feasible. Without it, such tasks would rely on the labour of officially-coerced unemployed claimants, forced to clean streets or plant trees, as part of a system of state serfdom - the 'Servile State' foreseen by Hilaire Belloc, from whom Blond claims to get his inspiration.

So, any chance of the share-out happening? Not to judge by the latest developments. On Wednesday The Guardian reported that RBS executives had awarded themselves shares worth £28 million as part of this year's bonus package. This indicates that the UK plutocracy has little intention of allowing its assets to be redistributed. Only concerted political pressure, by an organised movement of the young generation, will persuade them to share their vast wealth, and the government to reclaim for citizens their bail-out billions.

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