Vulture Capitalism: Corporate crimes, backdoor bailouts and the death of freedom

By Grace Blakeley

In mainstream news and political debate, the argument between capitalism and socialism is generally characterised as a choice between the freedom of the marketplace or the control of the state. Within that, there is an idea that socialist governments plan their economies, with negative consequences, while capitalist governments allow the economy to operate freely, unleashing creativity and bringing prosperity.

In this new book, the economist Grace Blakeley argues that this characterisation does not reflect reality. Capitalist economies are not defined by having free markets, and socialist economies are not defined by state intervention. She points out that the marketplace existed long before modern capitalism, and that modern capitalist countries have plenty of state intervention (including state ownership of services).

Instead, she says, the defining trait of capitalist societies is that they are dominated by capital and its interests. The defining trait of the alternative that she argues for, ‘democratic socialism,’ is that society and industry are democratised, so that decision-making power belongs to ordinary people. She argues that it is not true that capitalist economies allow the market to freely run itself, like a force of nature. All economies plan. The difference is not whether the economies are planned, but who does the planning.

In the UK and US, planning is done by big business, banks, states, and empires. These do not plan in a centralised, conspiratorial way, but through a network of shared interests and priorities, which means that these institutions work together to serve, ultimately, the interests of the wealthy and powerful. In other words, the planning is not done by a group of people in a room with a spreadsheet and a schedule, it is done piecemeal, by different nations, institutions and individuals, each with an interest in protecting the system. Banks decide which businesses to invest in, governments decide which banks to bail out, and governments also introduce laws that enable tax avoidance, decrease regulation, and lessen workers’ rights. All of these are forms of intervening in the economy to move it in a certain direction.

The book gives several fascinating examples: the rise of Amazon, the efforts of fossil fuel companies to resist climate measures, and the strange phenomenon of ‘investor-state dispute settlements’: legal mechanisms that allow corporations to sue governments whose policies hurt their profits. Blakeley tells several other stories, some of them harrowing. The picture she presents is of a world brutally dominated by capital, by governments and corporations that ride roughshod over workers’ rights, human rights, and the natural world, to protect their wealth and power.

At times, this picture feels overwhelming, but the book is also hopeful. Having thoroughly diagnosed the problem, Blakeley’s final two chapters show how democratic alternatives can be created, and the power of elites resisted, at both local and national levels. She tells stories of what communities and movements have already achieved, in the UK and across the world. These, she says, can be models and inspirations for the future. We should believe that another world is possible. 

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