Neo-liberalism is no longer working for Wales – we need to write our own economic story
Stories have played a crucial role in our understanding of the world for millennia, breaking down complex ideas or morals into a digestible form.
In Wales we have a proud tradition of folklore, in forms such as the Mabinogi, and these myths and stories have helped us to understand ourselves, our relationships with others and how we rule ourselves.
Stories are integral to our identity.
The economy is a staggeringly complex system that governs our lives and how we see ourselves and others.
To understand this invisible force, we have developed narratives to explain how the economy works. Over time these narratives changed and remoulded themselves countless times.
In fact, these stories can legitimise or revolutionise the economy – they have power. The narratives we use to explain the economy can change the economy.
In Medieval times, Feudalism dominated the economic system. Nobles held lands from the Crown, while the peasants were obliged to live on their lord’s land and give him labour and a share of their produce.
Every week this narrative was preached from the pulpit. The story was: ‘God anointed the King, who gave the lands to the Lords, who state I must work for them.’
Due to the story, the enormous exploitation of labourers was unchallengeable – as to challenge Feudalism would be to challenge God’s own top-down order of things.
However, as a wealthy middle-class grew out of the industrial revolution, another story was born out of the ashes of the Feudalist narrative – the story of Capitalism.
This said ‘private ownership of land, money and goods with trade would bring wealth and liberty.’
Once this story took hold those who challenged it, such as Marx, were dismissed as dangerous and mad. After a century of globalisation, it seemed incontestable.
Let’s fast-forward to the end of the Second World War. A new story born from the rubble of war argued for an economy built on solidarity.
The ‘post-war consensus’ of partial nationalisation, high taxation, an active Keynesianism, and the welfare state triumphed until Thatcher’s revolution.
Thatcher’s story contrasted with the post-war consensus. The New Right ideology of neo-liberalism, characterised by privatisation, austerity, deregulation and free-trade, had no space for society or solidarity – everything was reduced to individuals.
The right said “there is no alternative”. And the left shifted ever rightwards, until they became the very thing they formerly opposed. This is why Thatcher said Blair and Brown were her “greatest success”.
With New Labour, the left, right and centre advocated Thatcher’s narrative. Neo-liberalism was politically unchallengeable.
Instead, the story was rocked by a crisis of its own creation: the 2008 financial crisis and the resulting global depression.
The mighty, unregulated finance sector collapsed on itself due to subprime lending. Banks folded, unemployment rose and the seeds of neo-liberal capitalism’s downfall were germinating.
The 2010s saw neo-liberalism’s final spasm. A wave of privatisation, austerity and tax cuts for the rich and corporations flourished under Cameron’s government.
The longest on squeeze on real pay since Napoleon’s 1750s with pay falling behind inflation, a decade of lost economic growth and punitive welfare cuts have led many to question their own place in the economic story being told to them.
Meanwhile, the Labour Welsh Government have seemed powerless, or unwilling, to stand up for Wales.
Righteous anger is writing new economic stories. Brexit, Trump and the European far-right are delivering an economic story that reverses globalisation, reverses multiculturalism and reverses our rights in order to benefit the elite.
Their narrative is constructed to hide their system and its real purpose – to preserve wealth in the hands of elites.
The far-right must not hijack our economy by building a system that works for them, preserved by misguided support from the many.
The old story is dying. Neo-liberalism hasn’t worked for Wales and its tale is reaching its end. Whose story will replace it?
We in Wales have a choice. Do we support the Brexiteer capitalism of the Conservatives, or do we build a new economic narrative that creates a Wales built on democracy, fairness and freedom from oppression?
Will we need independence to put this story into reality and protect it into the future?
Our next economic story is up to us. Get writing.