Inequality has made some headlines in the UK since the recession and the (former head of Downing Street's policy unit) Ferdinand Mount has helpfully distilled some of the public discussions in his new book The New Few (Simon & Schuster). Not content with simply rehearsing the debate, Mount argues that there is something foul in the state of Britain when managers receive large bonuses at times of decreasing share prices and poor people struggle to get by.
His conceptual frame is the idea of oligarchy but this is where the argument sadly wears thin. Although Mount drops the names of Pareto and Michel who defined the debate on elites in the first half of the 20th century, his take on oligarchy and elitism is more discursive and argumentative rather than analytical. Aristotle gets a mention too with his juxtaposition of democracy, oligarchy and monarchy (where notably, Aristotle thought democracy a perverted form of rule).
Yet, it is Mount’s concept of oligarchy that fails to convince. One reason why is well illustrated by the argument Michael Walzer employs in Spheres of Justice (1983). Walzer distinguishes between the economic, political and social spheres and identifies the main challenge for modern politics in moments where power in one domain spills over into influential positions in another domain. It is this cross-sectoral ability to call the shots that hints at the essence of oligarchy in Aristotle’s meaning.
In other words, only where political influence directly translates into economic power, or vice versa, is democracy seriously jeopardised. Now, Mount may cite several instances where managers appoint each other to directorships on boards, and he might be right that there is an unhealthy cross-fertilisation amongst some people with influence in quangos and companies. Yet, Britain is nowhere near a true oligarchy in Walzer’s sense. In fact, we know an oligarchy when we see one, and we can observe one at our (European) doorstep: Russia.
The insidious aspect of Russian political and economic life is not that there are some extremely powerful people and some who are filthy rich but that both elites are deeply intertwined in personnel. Political power directly translates into economic power, often, as under Yeltsin, with immediate effect through shareholding.
Britain is a far cry from this paradigmatic type of oligarchy. You may deplore that Tony Blair is cashing in his fame (and perhaps his influence with some foreign potentates) but he has little say on who sits on the Labour front bench or on the board of BP.
But it is not only Mount’s conceptual take that has a wonky quality, it is also the overarching narrative that does not quite stack up. As he starts with an exploration of the banks and financial services, he follows a story that is shaped like a valley curve, with greed and usury at its highest during the beginning of the 20th century, followed by strict legislation curbing the power of the banking sector, leading to a resurgence of reckless financial activities after the Big Bang (in Britain) and the repeal of the Glass-Steagall Act in the US.
The problem is that this development is not neatly aligned with the increase or decrease in political and social participation, or oligarchic behaviour in either of these spheres (to use Walzer’s terminology). The story is a more complex one, with British industry suffering from one of its worst moments of corporatism (union and otherwise) during the times when banking demons were largely tamed. At the same time (during the 1060s and 1970s), Britain also saw a deepening of social mobility that, Mount hints at it, may have had little to do with the economy itself.
The sad fact is that much of the transformation that took place in the 1960s was due (amongst other things) to the delayed convulsions of war and the changes that came with them. The galvanising and transformative effect of war can be seen even more clearly in Germany and Eastern European states, where (sadly) the largest push in terms of social mobility was achieved not through democratic means but through the extermination of a whole section of society.
The Holocaust and the loss of 6 million people in Germany alone removed a whole cultural and political elite from society. Similar transformations happened in Eastern Europe where the Holocaust and the subsequent extermination of entire sections of society by the Communist regimes achieved temporarily an extraordinary upwards pull of lower working classes into the ruling elites.
In essence then Mount’s desire to forge a single trajectory of concentration of economic and political power fails to convince. Britain, just like West Germany and many other developed capitalist countries, experienced a plethora of significant economic, political and social changes, that had various origins and pulled their societies in different directions, hardly any of them exclusively oligarchic in character.
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