An economy ruled by the mob

Its not easy for any of us to get our heads around the complexities of modern economics. Many capitalists themselves and certainly most politicians no longer understand how the system really works. Thatcher and Osborne’s childish exhortations that nations have to balance their books just like careful housekeepers, budgeting so that outgoings don’t exceed income, is simplistic abacus mentality, suitable only in the kindergarten. It bears no relationship to today’s financial fantasy world. No areas of the economy have expanded over recent years like the finance sector.

Marx and Lenin warned about the eventual domination by finance capital of the capitalist system, but were unable to foresee how money itself would not only become a commodity, but that the capitalist system itself would become, in essence, a casino for the super rich.

Take even the idea of ‘investment’ and the term ‘investment banker’. In todays’ world they are complete misnomers. Investors no longer ‘invest’ in industry, manufacture and business, but simply buy and sell shares or financial instruments for quick profit. 

Business strategy today can be summed up in the epithet: fix it, sell it or close it. Companies can no longer afford to take a long-term view in terms of company strategy or to remain patient for markets to recover or improve. Shareholder value of a company has become the only criterion for judging its profitability. This means that rather than focussing on production and quality of product, management is obliged to focus on downsizing - wage reductions and staff cuts to increase share value.

Where four, five or even ten businesses determine the behaviour of whole branches of the economy, it becomes virtually impossible to oppose or counter their wishes or desires. Their investment decisions, as well as decisions taken on job losses or employment, whether to expand production, to contract or move facilities elsewhere have acute relevance for the fates of whole regions and even nations.

Share prices now the criterion

Alfred Rappaport in his book Creating Shareholder Value - writes that the core business theory today is that the value of a company lies not in how far it satisfies its customer base, the quality of its products or in its workplace standards, but exclusively in its functioning as a cash cow for shareholders. That means a company has to deliver profits in the here and now, not in the long-term. Because of the demand for quick profits, companies are under continuous pressure to deliver, not just annual, but quarterly profit reports; shareholders are not interested in long-term aims or strategies, but in high profitability in the short-term. This mentality and way of working can only be deleterious for manufacturing and social well-being, as well as economies as a whole. It bears no relationship to the individual or social needs of customers, workers or citizens.

Whoever dominates the market can pressurise their suppliers as well as customers, so it is better to invest in market dominance than quality of product or creative ideas. That is why takeover frenzy has characterised the recent period. In USA the change to this business model began in the eighties. Between 1984 and 1989 US manufacturers spent, on average, 184 billion dollars annually in taking over other companies, but less than half that (84 billion dollars) for investment in the factories and workplaces they originally owned. Only 21% of new credit was used for investment in their own production plants.

The reason investment in real infrastructure no longer makes sense in this topsy-turvy world, is that more money can be made, and made quicker, by buying and selling shares than by real investment in manufacturing. A Swiss Bank (UBS) investigation revealed that the ratio between investment into research and development, as well as new investment in existing companies, compared to turnover of the 500 largest US companies fell significantly in recent years. This is happening in other countries too. Companies are worried about spending in such areas as research and development as it is not reflected in the profit figures and, if they did so, it would thus lead to depressed share prices.

Already, in 1936 Roosevelt noted that ‘Government by organised money is just as dangerous as government by the organised mob’. but little notice was taken of this perceptive warning. In fact, one could argue that we are now under the control of organised money which is the mob! Today the real producing industries as well as most politicians are under almost total control of financial institutions.

In the ‘old-fashioned’, traditional capitalist economy, those with money invested in businesses and ‘by taking a risk’ with their money they could expect a profit from it. If the businesses were unsuccessful, investors ran the risk of losing that money, but if they were successful they would reap a profit. 

The problem with investing in manufacturing and industry, though, is that such investments have to made long-term and investors may have to wait until their investments show returns, whereas speculating in shares alone is short-term and returns are immediate.

With the reduction or, in some countries, even abolition of taxes on share buying and selling we have witnessed an acceleration in the tendency to simply trade in shares, currencies and financial instruments rather than invest in real industry and business. This has resulted in the buying and selling, or asset-stripping, of businesses and even whole nations rather than promoting investment in the production and research facilities themselves. Bigger and quicker profits can be made by cutting wages, employee numbers and asset-stripping. 

Fix it, sell it or close it

With increased globalisation, production has simply been moved to lower wage economies - a race to the bottom. For instance, the global toy-making industry during recent decades or so has wandered from country to country. Only 40 years ago, the USA was the world’s biggest toy manufacturer, then during the seventies US companies began moving production to Hong Kong, Taiwan and South korea. As wages rose there and unions were formed, they then moved to Malaysia, Thailand and Indonesia and the Philippines, and then finally to China. That is true of much manufacturing today. In the thirties there were globally around 50 relevant car manufacturers, in the seventies there were 25, by 2007 there were only 13 left. The global IT branch today is dominated by around two dozen companies; in other areas it is similar.

The way in which investment and money lending has shifted, has had enormous repercussions on nations and society. It has led and is continuing to lead to the destruction of indigenous industries and the starving of research, to the off-shoring of production and destruction of the social fabric by increasing insecurity, reducing employment opportunities, by forcing wages down and unemployment up.

Lloyd Blankfein, former boss of Goldman Sachs, in a 2010 interview with the German financial paper Handelsblatt, expressed his business philosophy by emphasising that the classic credit business was ‘too risky’ for him, because he’d ‘have to put all that precious money into factories, canal construction and satellite projects. And you can’t get out of those, at least not quickly,’ he said, ‘you are trapped. No, not that, that’s really too dangerous for our bank’. It is exactly that philosophy of the big ‘investment’ banks that is actually hindering investment, and it is hindering innovation and research because both these require long-term investment for them to make sense and deliver results.

What also characterises finance capital domination is that there are no longer any real risks involved in lending. Any big loss will only lead to the affected banks being bailed out by the state; bank managers don’t lose their jobs as a result of bad in investments. There is not even a market as such in the finance sector because it is dominated by very few all-powerful players who determine the rules. This finance dominated regime has also led to the increased indebtedness of nation states.

Debt is the ball and chain

The debts of most European nations have doubled in the last 15 years or so and from 2008 onwards these debts rose steeply. This is closely connected with the rescue operations undertaken on behalf for the banks, but it is also due to a country-by-country competition in tax-lowering measures for business and the wealthy, making Europe as a whole a tax Eldorado for the monied elites. In a word, state debts are simply the taxes the rich haven’t paid and the financial bets they lost. And for these debts, pensioners, working people and the unemployed and small businesses are paying with their very existences. 

These economic developments are not simply the result of stupidity but deliberate calculation. This strategy was spelled out very clearly already in the nineteen-nineties, by Herbert Giersch, Director of the German-based Kiel Institute for World Economy and advisor to the German government. He argued for the lowering of taxes in order to make the state so poor that ‘its empty cash tills would dictate’, alongside ‘a frightening deficit’, the facilitation of a radical down-sizing of the state sector without engendering widespread resistance. That is the underlying aim of neo-liberalism.

As a result of this cataclysmic shift in the way the capitalist system now operates, we have seen state economies, like those in Spain, Greece, Ireland and Portugal entering their death throes; month by month thousands of small businesses are being bankrupted, unemployment rises inexorably and whole generations are denied adequate living standards and exist with little hope or positive future.

The ‘solutions’ offered to correct the global financial crisis has been to advocate the cutting to the bone of public spending and forcing wages down. This has been accompanied by mass youth unemployment and increased poverty. Those countries with high deficits, like Greece, Spain and Ireland, are then asset-stripped by the bankers. But it is certainly not the people who stand to gain from this painful surgery, but the banks who lent and lost the money in the first place, and it is the self-same banks which print the money.

Of course the only viable solution would be to write off these state debts. But countries deep in debt are now even more in the stranglehold of the big banks and, just like individuals in debt are forced into compliance and are powerless to resist, they are too. Both are different expressions of the same ruse, called ‘control’.

Today, in Europe as a whole, the wealth of the small elite is larger than the combined national debts of all the European nations. If the European Central Bank did what it was supposed to do it could solve the national debt crisis easily. It should give cash not to the banks but invest it directly in productive infrastructure. Of course such lending would have to be properly regulated and controlled to prevent inflation, but it would make sense. At present the Central Bank is only allowed to lend to other banks not to individual nation states, and it does this at low interest rates, but the banks which borrow this money, then lend to the indebted states at a higher interest level, so making easy and handsome profits. At the moment these banks effectively control where the money is lent, and it is not invested in socially useful areas.

There is a clear reason why the Central Bank doesn’t extend credit to individual states: the business interests of the private banks who earn lucrative sums from the difference between the Central Bank’s interest charges and those they then pass on to the borrowing states. At the moment, here in Europe we are experiencing how these banks have the decision-making power over the rate of interest charged to nation states and utilise that in order to steer political policy their way. If nations had the right to obtain credit from the European Central Bank directly no one would have to worry about or take notice of hysterical and erratic financial markets, possible chain reactions or rating agency pronouncements. The present indebtedness of most European countries is almost exclusively due to the implementation of neo-liberal economic policies.

A law unto themselves

What has also helped push the banks down the road of unfettered speculation has been the removal of controls and the traditional obligation on banks to retain reserves in relation to lending, to minimise the consequences of unforeseen collapses. In the UK the minimum reserve obligation was abolished altogether. and in the USA it is only in force for certain categories of financial transaction. The European Central Bank demands that banks have a minimum reserve of 2% but that also only refers to certain balances and there are many creative ways of getting around such regulations.

The recent bank rescue operation of ‘quantitative easing’ has, in the main, poured money into the very same pockets of those who already had plenty of it, and has had a minimal impact on the markets in merchandise. Instead this money has been spent on buying more shares and credit papers, thus driving share prices upwards, but unlike price rises in the real economy that signify inflation, in the financial markets it does not mean inflation but ‘increased value’ and these rises are seen as a demonstration of successful economic development.

The tragic irony of the course present day capitalism has taken is that it is a driverless, heavy locomotive running ever faster to its own destruction. Of course, some of the less stupid capitalists, like George Soros for instance, do recognise the inherent dangers. Polly Toynbee, writing in the Guardian on 24 January 2014 mentions two others, in connection with the impending pensions crisis.

A recent paper  from the Conservative Centre for Policy Studies, authored by Michael Johnson, a former Cameron policy adviser and investment banker turned gamekeeper, and titled, Costly and Ineffective, ‘is so radical,’ writes Toynbee, ‘and egalitarian that it caused the resignation of CPS board members, including Lord Forsyth, doyen of many a City investment bank and insurance company who was reportedly "apoplectic" at what he called a "Stalinist" policy. No surprise, for it proposes the demolition of the pensions industry.

The paper pulls the rug from under the rationale for most tax reliefs, exposing vast sums the Treasury could claw back. Relief on contributions, national insurance, tax-exempt lump sums and others amounts to a phenomenal £48.4bn a year. Half all tax relief goes to the top 8% earning over £50,000, who need no incentives. Just abolishing higher-rate relief would bring in £7bn.

Such radical reform would, says Johnson, "require preparedness to confront deeply entrenched vested interests within the savings industry". But the government has just failed that test, even on the modest first step of capping pension charges stolen from the "hardworking" to line City silk purses.

The pension bill now in parliament has no cap, or transparency on charges. On Monday Lord Lawson, putting forward amendments similar to Labour's, demanded compulsory disclosure and independent supervision, complaining that "the foxes are regulating the hen coop". Here was a former Tory chancellor – a Tory chancellor! – saying: "There is absolutely no correlation between investment management fees and performance" – adding that "portfolios are being deliberately churned to generate commissions".’ 

So there is no excuse for arguing that these powerful financial managers don’t know what they are doing or don’t see the implications of their policies and the devastation they are causing. It is clear for all with eyes to see. But they are trapped in an anti-humanitarian juggernaut that is careering to self-destruction, but taking us all with it.

What Europe really needs is sensible economic policies that serve the people and not abstract economic theories; what we have, though, is governance by unelected financial bodies. Where profit alone rules, there is no space for democracy, as the recent banking crisis has clearly demonstrated, but the right conclusions are not being drawn by our political leaders. The powerful financial forces find democracy and democratic decision-making an annoyance and hindrance to their goals. That’s why democracy everywhere is being actively dismantled or is under threat. They want a completely compliant and predictable market, free of any regulation and control. 

In the complete opposite of what is needed in order to solve the crisis, still greater areas of public life are being privatised. A poor nation state is a dependent state which is no longer in a position to regulate the market. Such unregulated markets only strengthen the strong and enfeeble the weak even more, and they polarise society more. This results in national markets and means of production being devastated and a situation in which only the few ‘fittest’, i.e. strongest, will survive. 

Social democrats have no clothes

The old Social Democratic vision of being able to create a ‘caring capitalism’ or what the Germans called ‘a social market economy’ is in tatters. It was always a chimera, but that is clearer now than ever. Social Democratic parties, like the Labour Party, find themselves, vis a vis blanket financial dominance, bankrupt of any ideas, and are desperately thrashing around for ways of demonstrating any difference between themselves and the conservative parties to sceptical electorates. Social Democratic policy was traditionally based on the ideas of personal responsibility in business, a mixed economy and a welfare net to protect the most vulnerable from the worst ravages of the system. The policies of all bourgeois parties today, but particularly social democratic ones, has as much in common with that of their founders as Thatcher had with Mandela.

In a pathetic attempt to insert a wedge between Labour Party policy and that of the coalition government, Ed Balls’s recent modest proposal for a tax increase for the very rich from 45p to 50p in the pound has been greeted by squeals of outrage from the wealthy elite and its media hacks. Jonathan Isaby, chief executive of the Tax Payers' Alliance, said the 50p rate would be "an unmitigated disaster" for Britain. But historically 50p would still be very low. In 1971 the top rate of income tax on earned income was cut to 75%. In 1974 that cut was partly reversed and the top rate on earned income was raised to 83%. Margaret Thatcher, who favoured indirect taxation, i.e. making the poor pay more, reduced personal income tax rates during the 1980s from 83% to 60%. So Balls’s proposal is still 10% less than what the rate was under Thatcher!

Recently, the financial sector has provided an unprecedented profitability, but it was not always like that. By 2007 the profitability of the financial sector in the USA was 41%, whereas between 1973-85 the comparable figure was only 10%.  Almost every second dollar earned in the USA since 2007 was by the finance sector - what a profound distortion of the national economy. A similar seismic shift took place in the UK under Thatcher and Blair, resulting in a devastating contraction of manufacturing in the country. And this destruction of manufacturing brings with it a concomitant loss of tradition, experience and skills and social devastation.

The almost total lack of bank regulation by governments has led to this impasse. We now have a casino economy, and in a casino economy, the owner of the joint wants control not a free market among players. And it is the giants now dominating the world economy that are running the casino. The market for credit default insurance before the crisis had a turnover of US$60 trillion and is dominated by only five big players: JP Morgan, Goldman Sachs, Morgan Stanley, Barclays Group and Deutsche Bank.

In the USA the 25 most successful hedge fund managers earned more over recent years than the bosses of the 500 largest companies registered on the stock market. That’s why anyone looking for a lucrative career in business today goes into the financial sector. These massive returns are coming not from investment in manufacturing or supplying business credit, but from gambling, pure and simple. 

Unless our subservient politicians are willing to challenge the financial big boys head-on, we are doomed to be crushed as their juggernaut rolls on remorselessly over us.

Many of the ideas and some of the facts contained in the above article have been culled from the excellent analysis of today’s capitalism, Freiheit statt Kapitalismus - ueber vergesssene Ideale, die Eurokrise und unsere Zukunft (Freedom instead of Capitalism - on forgotten ideals, the Euro crisis and our future), by Sahra Wagenknecht, a member of the Federal German Parliament for Die Linke.

END

Don’t let the jingoists highjack First World War commemorations

Don’t let the jingoists highjack First World War commemorations

When Oh What A Lovely War was premiered at the Theatre Royal in Stratford East in March 1963, it sent its audience wild with approbation.

But at the time many mainstream critics were less than enthusiastic about Joan Littlewood's musical satire on the first world war.

The Guardian noted that "it was as unfair as any powerful cartoon" and The Times wrote that it repeated "the familiar view of the war as a criminally wasteful adventure. A sitting target for anyone who wants to deliver a bludgeoning social criticism without giving offence."

Not only did Littlewood, founder of the legendary Theatre Workshop which has inspired theatre practitioiners ever since, present a completely new take on the history of that horrendous war. She also made an iconoclastic break with West End theatrical tradition.

The show, whose title is derived from the music hall song Oh! It's A Lovely War, has become a marker in British theatrical history. Littlewood used Bertholt Brecht's ideas on the politicisation of theatre to better convey the realities of war.

Using minimal props and Brecht's half-curtain for rapid scene changes, imaginative lighting and sound effects, the audience is transported straight to the trenches.

Littlewood sought the truth in the stories told by ordinary soldiers, their bawdy and irreverent songs and the earthy humour that helped them keep sane in the abattoirs of the trenches.

She contrasted their lives with the pompous pontification of top officers and government politicians at home, totally divorced from reality and lacking any sense of empathy. The piece used facts and statistics, juxtaposed with reminiscences and versions of songs of the time, as an ironic critique of the reality of the war.

Previously WWI had always been seen through the glorifying spectacles of misty-eyed nationalism or the tragedy-laden, fatalistic lines of war poets like Siegfried Sassoon and Wilfred Owen. And now Education Secretary Michael Gove is trying to wind the clock back once more.

Left-wing myths about the first world war peddled by the TV series Blackadder belittle Britain and clear Germany of blame, he wrote in a recent Daily Mail article. He lambasted historians and TV programmes that denigrate patriotism and courage by depicting the war as a misbegotten shambles.

The conflict, according to Gove, was a just war to combat German aggression. The minister, who has already rewritten the school history curriculum supposedly to give pupils a better grasp of the broad sweep of British history, reserves his greatest scorn for those who have sought to depict the soldiers as lions led by donkeys, a metaphor starkly underlined in Littlewood's musical.

The coalition governmemnt has already pledged £50 million in public money to mark the event, with school trips to battlefields and ceremonies planned over four years, hundreds of hours of TV programming and, no doubt, military parades and exhibitions of the latest military hardware.

The idea for Theatre Workshop's production started in 1962 when Gerry Raffles heard Charles Chilton's BBC radio musical about the war, The Long, Long Trail. It was written and produced by Chilton, who later went on to work with Ewan MacColl - later Littlewood's husband and collaborator - on their famous radio ballads series.

Theatre Workshop developed productions through improvisation and initially the cast would learn the original script but then have that taken away and have to retell the story in their own words for performance. Each member was tasked with learning about a particular topic, such as Ypres or gas.

As the production developed it also used scenes from The Donkeys by military historian - and future Conservative politician - Alan Clark. With his contribution initially unacknowledged, Clark took Littlewood to court to get credited.

Littlewood decided on pierrot costumes from commedia dell' arte as a "soft, fluffy entertainment mode" in ironic contrast to the tin hats which the cast also wore. There is no blood or realistic horror - words and sounds alone provoke the images in the mind. Richard Attenborough's sugary film of 1969 based on Littlewood's musical was, sadly, a travesty of everything the play achieved and represented.

Oh What A Lovely War is undoubtedly one of the greatest anti-war plays ever and its revival by Theatre Workshop in Littlewood's original theatre in Stratford East next month can't come too soon as an antidote to the Establishment's spin on the conflict. One of the theatrical events of the coming year, it's not to be missed.

First World War - a retort to all the sanctimoniousness

War Memorials 1914-18

Some fell, the inscriptions say,

but did they trip

or were they pushed?

Some lost their lives.

You do tend to lose things

in a foreign country,

but this does seem a bit careless

Some gave their lives, we’re told.

which was certainly generous,

- perhaps to a fault.

Some even made the supreme sacrifice,

so others assure us,

on their behalf.

But, you would never think

from reading these memorials,

that anybody desperately wanted to live,

and then got killed.

From: Agit Poems by Bob Dixon (Artery Publications 1984)

Roque Dalton: Fusilemos la Noche! (Roque Dalton: Let’s shoot the night)

Roque Dalton’s name is hardly known in Britain, but in Latin America his reputation as a poet is up there with the best. He was killed in 1975, aged only 38, murdered by his erstwhile comrades in El Salvador’s ERP Guerrilla movement.

Today he has become El Salvador’s posthumous national poet. He wrote passionate, at times sarcastic, image-laden works dealing with life, death, love, and politics.

The Salvadorian embassy is to be congratulated for organising the premiere of a new film about Roque Dalton’s life by the Austrian film maker Tina Leisch. It was ably introduced by Roger Attwood, an acknowledged expert on the poet and his work. The film is a more than fitting hommage. 

The only archive footage that exists of Dalton is a few seconds of badly scratched film from a Cuban interview with him. So Leisch had to trace his footsteps meticulously to build up a rounded picture of the man. She finds and interviews not only one of his sons and his wife, but former girlfriends, fellow poets and writers, several former comrades from the ERP, as well as short, perceptive contributions by Regis Debray and Eduardo Galeano.

As a young man Dalton was captured by police forces of the military dictatorship on several occasions and once escaped a probable death sentence when an earthquake destroyed the prison in which he was incarcerated. 

After training in Cuba, he returned to El Salvador and tried to join the main Salvadoran political-military organization Popular Liberation Forces ‘Farabundo Marti’ (FPL). but its leader, Salvador Carpio, rejected his application, saying that Roque's role in the revolution was as a poet, not as a foot-soldier. Because of this, he joined the People's Revolutionary Army (ERP), the military wing of another left-wing faction. 

In his short life he was a prolific writer of plays, short stories, a novel, journalism and many poems. Leisch solves the filmic problem of dealing with poetry in film by persuading the people she talks to, from vendors and students on the street, to former girlfriends and comrades to read some of them, even a policeman in uniform is persuaded to read one on imprisonment and torture.

She follows Dalton’s footsteps from El Salvador to Prague, from Vienna to Havana and in each place sets up a larger than life cardboard-backed photo of Dalton to provoke reactions from her interviewees, and to emphasise his continued presence amongst us. Small elements of animation underline Dalton’s humour and passion for life alongside his earnest politics.

Leisch’s film in many ways mirrors Dalton’s iconoclastic poetical forms, his deep feeling for the language of the streets and his unique mix of tenderness, fun, philosophic curiosity and his outrageous larger-than-life personality. Her film is no hagiography and she doesn’t avoid Dalton’s failings, but in the end the audience is made aware not only what a creative genius this man was, but what a tragic loss his early death was, both for the revolution and for literature. 

In 1955 he and the Guatemalan poet Otto René Castillo founded Círculo Literario Universitario - a group of contemporary writers - which published some of Central America's most recognized literary figures. He also won a prestigious Casa de las Americas prize for his writing

Dalton deserves to be wider known here in Europe and is, alongside his compatriot and fellow communist Neruda, the most deserving of the title ‘poet of the revolution’. I sincerely hope this film will help redress that lack.

Dalton (1937–75) was the major literary figure and an important political architect of the revolutionary movement in El Salvador. Like his friend and contemporary, the Guatemalan poet Otto René Castillo, he chose  to combine a writer’s life with that of a guerrilla fighter and paid the ultimate price: precocious martyrdom. 

End

Remembering the witch hunts

Remembering the Witch Hunts

This year marks 50 years since the height of the Hollywwod witch hunts. From today’s perspective it is difficult to imagine that the USA once had a powerful progressive and left-wing movement and a strong Communist Party that attracted numerous prominent figures to it. Before the poisonous paranoia spread by the House Committee on Un-American Activities (HUAC), followed by McCarthyism had infected the country with its deadly fever, the United States was widely respected for its political freedom and progressive spirit.

            Despite the rise of fascism in Europe and right-wing gangsterism in the USA, the period during the thirties and early forties, shortly before the blacklist, was also a time of left-wing optimism and successes. Although Hollywood was not dominated by left-wingers, they were not without clout. The Communist Party had, at an estimate, around 300 members and at least double that in terms of sympathisers, many in well-paid and respected positions. But, it wasn’t all serious politics; the parties and fun that was had by these Lefties is perhaps surprising under the circumstances, and the invitation lists read like a Who’s Who of Hollywood celebrities.

            The leadership provided by the Communist Party of the USA in combating fascism, its commitment to anti-racism and minority rights and success in building the trade union movement unleashed the hatred of the capitalist class and right-wing politicians. The infamous HUAC hearings were used to suppress and make illegal not just the Communist Party but anyone associated with it as well as any organisations in which it avowedly had influence. As a result, tens of thousands were blacklisted, careers and lives were destroyed and families broken. The country was plunged into a nightmare of fear, hysteria and red-baiting from which it never properly recovered. Party officials were, under the Smith Act, deemed to be foreign agents and subject to draconian sentences; in Texas they even faced the death penalty.

            Because of their prominence, celebrity status and ability to articulate ideas, those film workers in Hollywood who became the focus of attention for the witch hunters are the ones most talked about. Many books have been written about the Hollywood blacklist, but Tender Comrades by Patrick McGilligan and Paul Buhle is one of the best. Such books are a chilling reminder of just how neo-fascism and the emergence of a totalitarian security apparatus can lurk just below the surface in an apparently open and democratic society.

            Many of those who became leading figures in the motion picture industry in Hollywood during the thirties and forties and were also members of the Communist Party or fellow travellers, came from poor, immigrant Jewish backgrounds. This experience gave them an understanding of ordinary people, of their struggles and of life as lived ‘at the bottom of the pile’. It gave many a strong sense of solidarity, of sympathy with the underdog and with discriminated minorities. It is also one of the chief reasons why such people were so sought after in Hollywood as writers, because they could turn in believable dialogue that encapsulated the tragedies, humour and resilience of ordinary people. They were able to endow what were often banal original stories with the necessary human interest, drama and social relevance that would make them successful box office hits. 

            Most of the big picture moguls of the time – who ruled their studios with the iron fist of feudal lords – had little idea of how to make films, but had the money to hire those that did. They invariably had clichéd outlooks, right-wing politics and strong Puritanical moral pretensions, but ironically, they employed many Communists or left-wingers who knew how to write and create the films that made them their money.

            The well-known character actor Lionel Stander, commenting on life in thirties America, said: ‘To paraphrase Dickens, it was the best of times and it was the worst of times – the best of times because you were young, and the worst of times because of the actions of Hitler and Mussolini, etc. Hollywood was the Mecca for nearly every worthwhile intellectual in the 1930s from all over the word. You saw a lot of what was happening through the eyes of the German refugees – actors, writers, directors, technicians, and artists – who came here and through the activity of mass organisations like the Hollywood Anti-Nazi League, etc. The power of the left existed because it said all the things that everybody believed in and wanted to hear; it represented every person who believed in human decency, justice, and equality and was against racism and bigotry. And the Communist Party always took the frontal position.’

            Betsy Blair Reisz, a dancer and actress, married first to Gene Kelly and later to the British film director, Karel Reisz, has an unusual biography in that she tried to join the US Communist Party after the war but was told by the leadership that she could be more effective outside, and if she were to join it could harm Gene’s career. Gene Kelly was, and remained a solid left-winger, who supported many progressive causes -  a ‘social democrat’ Betsy called him. She won critical acclaim for her film roles and a Best Actress Award at Cannes. Once blacklisted she left the USA first to France and then the UK. In Europe, she acted in films made by leading progressive directors like Antonioni, Tony Richardson and Costa-Gavras.

            One interesting tit-bit revealed in the book – which has resonances with the surveillance being carried now - is how the FBI used psychotherapists. Many Americans, even at that time, used psychotherapists the way Catholics use the confessional or others use the bus, so the Party insisted that anyone visiting a psychotherapist leave the Party. One of the chief FBI informers was a ‘lefty’ psychotherapist called Phil Cohen to whom many left-wingers in Hollywood turned.

            Many of those black-listed were talented, humane and fascinating individuals. Their life stories provide a depiction of the Hollywood ‘dream factory’ in its heyday and a historical narrative very different from the mainstream one. They also offer fascinating little vignettes of many of the famous celebrities and villains of that time from John Wayne, James Cagney, Marilyn Monroe, Frank Sinatra, Ronald Reagan, Walt Disney and Sam Goldwyn among many others.

            Norma Barzman, another Hollywood blacklistee who found refuge in France and Britain wrote the book, The Red and the Blacklist (2003), about that period of blacklisting and exile, also reveals the comic side. Her friend, the blacklisted writer John Barry, responding to her query how things were: ‘It's hell,’ the communist director said of exile. ‘I live in Paris, meet beautiful women and go out to dinner with Jean-Paul Sartre.’ For actors, of course, it was much more difficult than for writers who could use pseudonyms and ‘Fronts’ The actor Zero Mostel noted that, unlike scriptwriters, he couldn't hide from the blacklist by adopting pseudonyms: ‘I am a man of a thousand faces, all of them blacklisted,’ he said.

            Through the words and stories of these individuals it also becomes clear how different the United States could have been if the right-wing had not been successful in suppressing the left-wing and creating such a climate of fear of all things communist or associated with it. It managed to achieve a ‘brain-washing’ of generations of US citizens, imbuing them with an irrational fear and a distorted ideology that enabled capitalism to run rampant and imperialism to wage wars unhindered. Those of us elsewhere in the world who lived through those oppressive decades at the height of the Cold War also paid the costs.

END

1261 Words

John Green

Pay day loan sharks

The greatest hazard to health - loan sharks

Usury – is defined as lending money at unethical interest rates. The practice has been condemned ever since money became the chief means of undertaking transactions.

Some of the earliest known condemnations came from Indian Vedic texts. Similar condemnations can be found in religious texts from Buddhism, Judaism, Christianity, and Islam. Throughout history, many nations from ancient China to Greece and Rome outlawed loans with any interest. Though the Roman Empire eventually allowed loans with carefully restricted interest rates, the Christian church in medieval Europe banned the charging of interest at any rate. How civilised our forebears were!

Today the Christian churches have little to say on this important issue and the wealthy Islamic states have no qualms about investing globally and profiting from interests on loans. Governments, too, see no need to introduce legislation to protect the most vulnerable from loan sharks and unscrupulous financial operators. Although so called ‘payday loan’ firms, which often lend to those who cannot obtain loans from High Street banks, are currently the subject of a Competition Commission review.

The ubiquitous lending firm Wonga – ‘the payday loan alternative’- recently reported pre-tax profits of £84.5m for 2012, an increase of 35% on the previous year. It is symptomatic of the immoral and unscrupulous times we live in that a company like this can operate and flourish with impunity. This government has made no attempt to curb its predatory activity.

The company has a representative APR of 5,853 per cent - although a typical advance of £200 for 14 days would incur fees and interest of around £34. But the company knows from experience that borrowers can rarely pay back in time, thus incurring high interest rates – that’s how it makes its money.

Its chief victims, of course, are the poor and those who find themselves in temporary financial difficulty ie those least able to repay the loans on time, if at all, so that in the meantime have to fork out horrendous sums in interest. The result is misery, mental health problems, family breakdown and homelessness.

In the old days the local loan shark would do his rounds, knocking on the front doors of those likely to be in need. Today loan companies use the internet – it’s cheaper for them and anonymous.

Ordinary working people and particularly the poor are those who always suffer most in times of crisis. We are not only being made to pay for the incompetence and greed of bankers, but also being ripped off by such so-called loan providers. But the ruling elite doesn’t care. It takes the same attitude as its heroine Margaret Thatcher did when she remarked to the then French president, Francois Mitterand, who was planning to bring in legislation to tax the rich. ‘But, Francois,’ she said, ‘why do you want to tax the rich, there are so few of them, it’s much better to tax the poor as there many more of them.’

Wonga’s South African-born chief executive Errol Damelin is coining it. He set up Wonga in 2007 with business partner Jonty Hurwitz - and now employs 500 people, making 3.5million loans last year totalling £1billion, which was a 40 per cent rise on the previous year. Damelin has a £30million stake in the company, which is based in Camden, north-west London. Damelin was educated at Boston University in Massachusetts and Cape Town University, and founded his first company in Israel.

In a rare public expression of disgust by religious bodies, last year, Justin Welby, the Archbishop of Canterbury, called Wonga.com's high interest rates ‘shocking’ and ‘usurious’. He promised to compete it out of existence by setting up a Church of England credit union.

What is equally insidious is the way other companies and organisations who should no better, are jumping on the Wonga bandwagon. Wonga sponsored free travel on the London Underground on New Year's Eve in 2010, and posters were put up on the network with the slogan ‘sometimes you need some extra cash’ and giving the website details. London Assembly member Jennette Arnold said that it was 'shameful' that the Mayor of London had allowed such sponsorship at a time of year when people are most vulnerable financially. Transport for London later banned payday loan companies from sponsoring their services.

In October 2012 Wonga announced a sponsorship deal with Newcastle United for £8m a year. Several MPs spoke out against the deal and the leader of Newcastle City Council told The Guardian he was ‘appalled and sickened’ that the club had signed a deal with ‘a legal loan shark’. In July this year Papiss Cissé courageously refused to wear the kit. In 2012, Wonga.com sponsored ITVs Red or Black, which also evoked wide criticism. In January it was announced that the firm will sponsor the UK showing of American Idol on Channel 5 for Season 12.

Mr Damelin defends Wonga and says: ‘Access to practical and affordable sources of credit is a big issue for our society and Wonga is playing a part by lending responsibly, and at scale, to people who can generally afford to pay us back quickly.’

Thomas Cromwell – a maligned figure of English history

Thomas Cromwell – a maligned figure of English history

Until the success of Hilary Mantel’s trilogy, focussing on the life of Thomas Cromwell, few would have recognised his name, and even fewer would have had an inkling of the key role he played in English history. He was one of the leading forces in the English Reformation and laid the basis for the modern state.

His relative eclipse is undoubtedly also associated with the very class-based historical research approach of previous historians who were unsympathetic to the idea of ‘ordinary men’ making history. Cromwell is often described as ‘the most hated man in England’ A recent Guardian piece labelled him ‘the ruthless master politician’. However, a more contemporary evaluation written by Thomas Fuller in his Church History of England in 1655 said: ‘This was the cause why he was envied of the nobility, being by birth so much beneath them and by preferment so high above most of them…’

Cromwell was a poor boy, the son of a Putney brewer and blacksmith, who rose to become one of the most powerful men in England, mixing as an equal with the aristocracy. He was hated by many of the aristocrats as an upstart of low-breeding. They also recognised the danger he posed as an outsider with no tribal interests to defend. He was undoubtedly Henry VIII’s most loyal public servant and rose to become his chief minister, in which role he served from 1532 to 1540, before a conspiracy of his aristocratic enemies persuaded a volatile and increasingly fractious Henry to arrest and execute him.

How did this man of such humble birth become, for a short time, the most powerful man in England?

Unfortunately we know little about his early life. Mantel imagines a miserable childhood as the son of a violent, drunken father. It is reasonably certain that he ran away as a youth and spent a number of years on the continent, where he learned several languages, diplomatic and financial skills and forged valuable contacts.  He learned about politics, economics and met some of the leaders of the Luther-inspired Protestant revolution then sweeping through Europe. His life-shaping experiences in France, Italy and the Netherlands undoubtedly gave him the necessary credentials for his later career. He had been a soldier, a merchant and an accountant for a Florentine bank. Importantly he had clearly been impressed by the Protestant reformation.
In 1527 he was back in England, a little over forty years old and already a trusted agent of the powerful Cardinal Wolsey. Mantel portrays Cromwell as possessing an all-round competence: ‘at home in courtroom or waterfront, bishop's palace or inn yard. He can draft a contract, train a falcon, draw a map, stop a street fight, furnish a house and fix a jury.’
Cromwell was not only one of the strongest advocates of the English Reformation, he was also in a position to do something about it. His helping to engineer the annulment of the King's marriage to Catherine of Aragon, so that Henry could marry his mistress Anne Boleyn, gave him the key to push reform further. He realised before many others that without a break from Rome and a curtailment of the powerful and wealthy monasteries in the country, England would never be a truly independent, powerful and sovereign nation. Supremacy over the Church of England was officially declared by Parliament in 1534. Cromwell, particularly after his experiences in Italy and elsewhere in continental Europe developed a healthy disgust of the waste and superstition of the Catholic Church, and he took a very materialist view of relics and indulgences.

Today, he is largely remembered for the key role he played in Sir Thomas More's conviction and execution for treason in 1535 – he is portrayed as the villain and More the hero in Robert Bolt’s film A Man for all Seasons. But More was rather the victim of his own stubbornness than of Cromwell’s ire – he several times gave More the opportunity to change his opposition to Henry’s marriage annulment. He recognised that More’s intransigence on this issue, if allowed to go unchallenged, would jeopardise the necessary reform of church and state and a break with Rome which he so assiduously sought.

He should be remembered primarily as a remorseless reformer and legislator, unblinkingly opposed to an old religion that ‘keeps simple people in dread’ and that was, moreover, sitting on a fortune that could be put to better use.  He tells More in a key remark that, ‘among the ignorant it is said that the king is destroying the church. In fact he is renewing it. It will be a better country, believe me, once it is purged of liars and hypocrites.’ For the first time in history, Englishmen were able to read the Bible and prayer book in their own vernacular.

Mantel's relatively sympathetic interpretation in her novel owes much to the German-born Tudor historian, Geoffrey Elton, who portrayed Cromwell as the prime mover behind the Tudor revolution in government – the first glimmerings of the modern English state. In Mantel's hands, this picture of Cromwell as a reforming legislator acquires new life, as he meditates on how the state can offer work to the unemployed:

‘We could pay them, he calculated, if we levied an income tax on the rich; we could provide shelter, doctors if they needed them, their subsistence; we would have all the fruits of their work, and their employment would keep them from becoming bawds or pickpockets or highway robbers, all of which men will do if they see no other way to eat.’

Its hardly surprising that the England of Mantel's Cromwell, a nation in flux and turmoil, should resonate with our own. It is a world seemingly suspended between an old order past its sell-by-date and a new order waiting to be born. Cromwell was the man for those times. He realises that England will never be great unless it breaks with a corrupt and over-wealthy Roman Church. Given the era he lived in, he could see that the only way to achieve these reforms was by empowering the monarch and winning his support. He was a fervent believer in a well-run state and he set about constructing one on his sovereign's behalf and with the common wealth in mind. He knew what needed to be done and how to do it. To accuse him retrospectively and anachronistically of brutality and scheming, is to use a contemporary yardstick, rather than the bloody and opportunistic measures of Tudor times.
In July 1536, the first attempt was made to clarify religious doctrine after the break with Rome. Bishop Edward Foxe, with strong backing from Cromwell and Cranmer, tabled proposals in Convocation, which the King later endorsed as the Ten Articles. Cromwell circulated injunctions for their enforcement that went beyond the Articles themselves, provoking opposition up and down the country. These widespread clerically-inspired uprisings were successfully suppressed. This success spurred further Reformation measures. In 1537, Cromwell convened a synod of bishops and doctors to prepare a draft document, The Institution of a Christian Man. Cromwell ensured that it was in circulation, even before the King had given his assent.

He was a reformer, not a zealot. He found old practices unsavoury – hairshirts, indulgences for relief from purgatory – but he was also, at times, exasperated by the obstinacy of those such as Tyndale, the translator of the Bible into English, on whose behalf he tried to broker a deal with Henry.

Throughout 1538, Cromwell pursued an extensive campaign against idolatry by the followers of the new religion. Statues, roods, and images were attacked, culminating in the dismantling of the shrine of St. Thomas Becket at Canterbury. He also completed a new set of injunctions declaring open war on ‘pilgrimages, feigned relics, or images, or any such superstitions’, and commanding that ‘one book of the whole Bible of the largest volume in English’ be set up in every church. Moreover, following the surrender of the remaining smaller monasteries during the previous year, the larger monasteries were now also ‘invited’ to surrender throughout 1538.
As the reforms progressed, and despite the riches pouring into Henry’s coffers, he grew increasingly worried about the extent of change, and with the conservative faction at court gaining strength, he began to resist further Reformation measures. The King's anger at being forced to marry Anne of Cleves was the opportunity Cromwell's conservative opponents, most notably the Duke of Norfolk, needed to topple him. Cromwell had thought this marriage to a German would help cement Protestant reforms.
His life and legacy have aroused enormous controversy. However his effectiveness and creativity as a royal minister cannot be denied. During his years in power, he skilfully managed Crown finances and extended royal authority. In 1536, he established the Court of Augmentation to handle the massive windfall to the royal coffers occasioned by the dissolution of the monasteries. Two other important financial institutions, the Court of Wards and the Court of First Fruits and Tenths, owed their existence to him. He strengthened royal authority in the north of England through reform of the Council of the North, extended royal power and introduced Protestantism in Ireland, and was the architect of legislation, the Laws in Wales Acts, which promoted stability and gained acceptance for the royal supremacy in Wales. He also introduced important social and economic reforms in England in the 1530s, including action against enclosures, the promotion of English cloth exports, and the poor relief legislation of 1536. By master-minding these reforms, Cromwell was said to have laid the foundations of England's future stability and success.

Despite his widespread reputation as a cold-bloodied opportunist, he showed considerable generosity towards friends fallen on hard times and to the poor. He carried out a ritual distribution of food and drink to 200 poor Londoners twice daily at the gates of his residence. In his will he left monies to ‘penniless maidens on their marriages, money to be distributed to the poor and to prisoners of several prisons within the area where he had lived for much of his life. His accounts are littered with divers donations to the poor and needy.

He was a close friend and supporter of Thomas Cranmer, who became Archbishop of Canterbury and was a reformer like Cromwell himself.  He published the first service in the vernacular and actively promulgated the new (Protestant) doctrines through the Book of Common Prayer and other publications.

Henry was never really interested in the ideas behind a modernised religion, but was happy to go along with Cromwell’s reforms as they helped consolidate his own power, brought him considerable wealth from the dissolved monasteries and, of course, allowed him to annul his several unsuccessful marriages.