German philosophers Karl Marx and Friedrich Engels published their Communist Manifesto in 1848 and, given the ubiquitous poverty and squalor of the 19th century, they were not short of inspiration.
While on a visit to Manchester, Engels remarked to a local businessman on the destitution all around, to which the indignant man of commerce replied: “And yet there is a great deal of money made here… good morning, sir!”
In 2018 the ‘have nots’ have not gone away. A short walk through Liverpool city centre, strewn with homeless people, is testament to that. Challenges remain and yet we are light years away from the hellish conditions of the 19th century.
However, the idea that business and commerce is a rapacious beast; at best a necessary evil that must not be given an inch, not only persists but has gained traction again since the financial crash.
Capitalism is not perfect but is by far and away the most successful economic system in the history of civilisation, and that comes from someone who described himself as a socialist for almost 20 years. Contrary to what some would have us believe, the world is getting richer, not poorer.
According to data from the World Bank, in 2013 10.7% of the world’s population lived on less than $(US)1.90 a day, significantly down from 35% in 1990. Around one billion people were pulled out of extreme poverty during that period.
And yet the growing mantra is that ‘profit’ is a dirty word and shareholders (who are mostly pension and investment funds, not rich individuals) and big corporations are robbing us blind.
In a speech in February, the Leader of the Opposition took aim at the UK’s financial services sector. Jeremy Corbyn was going to “take on the power of finance” and “stand up for the real economy”.
Financial and professional services employs 2.2m people in the UK, two-thirds of those outside of London. Annually the sector generates £95.7bn in exports. More crucially, it is the biggest single contributor to the Exchequer, paying £90bn in taxes every year – 11% of total public spending.
In the Liverpool city region alone, figures from the LEP show there are 107,000 people employed in professional and business services, across 12,000 companies, contributing £8bn annually in GVA.
Yes, Jeremy is right, this really can’t go on.
In the 1980s, Liverpool Council rejected market economics and embarked on a disastrous socialist experiment which led to near bankruptcy and turned us into an investor-free zone for two decades.
In the last 10 years our city’s turnaround has been transformational, with the visitor and maritime economies alone now worth a staggering £4bn a year each. Yet our recovery remains fragile. Business density is still too low and we lag other comparable cities in terms of investment.
Some of the angry, confrontational voices of the 1980s are back and re-establishing a power base in Liverpool – and they are no fans of business and commerce. We have to resist their rise. They could push us to the brink of ruin once again.