August 31, 2015
Dean Baker
The Hankyoreh, August 31, 2015
View article at original source.
According to several news reports, it appears that Jeremy Corbyn, the candidate of the left faction of the Labour Party in the United Kingdom, is likely to be the party’s candidate in the next election. That should be good news to those who were troubled by the previous leadership of the last Labour Party government, which seemed more interested in helping London bankers than the country’s workers.
Unfortunately, some of the accounts of Mr. Corbyn’s platform are not encouraging. They include plans for the nationalization of several major industries. There is enough history with nationalized industries in the U.K. and elsewhere to view this policy with caution. We should know that there is no guarantee that a nationalized industry will be better run than if the industry is left in the private sector. There will be times, most obviously with natural monopolies, where nationalization is likely to make sense, but at this point we should all know that there is nothing progressive about nationalization as an end in itself.
In fairness, I have not tried to get the details of Mr. Corbyn’s platform and it is entirely possible that the news accounts have not presented it accurately. But we have just witnessed several notable cases of progressives gaining power and failing to pursue policies that would effectively advance progressive ends.
The situations of several of the populist governments in Latin America stand out. No one could be happy with the current economic situation in Brazil or Argentina. The Syriza government in Greece won power in January on a commitment to end austerity. It turned out that its only strategy was an appeal to the decency of the leaders of Germany and other European powers, there was no Plan B. Not surprisingly, this has not turned out very well for the Greek people.
In the United States, there has been great progress in drives to raise the minimum wage at the state and local level. This is a policy that can make a huge difference in the lives of millions of low-paid workers. However in some cities there is a real risk that the push may go too far. A minimum wage that is too high will lead to substantial job loss among a population that badly needs work. Some cities may be setting their minimum wage at levels where unemployment among low wage workers will be a serious problem.
At a time where there is substantial public support for progressive policies in many parts of the world, leaders have often not been able to effectively implement policies that benefit those who voted them into power. This is a serious problem. The goal of progressive politics is of course to improve people’s lives. When we get a chance to actually put our policy into practice, it is important that we do we everything we can to ensure that we do things right.
We will inevitably make mistakes, but it is inexcusable to make mistakes based on laziness or unquestioned adherence to outdated political views. For example, no progressive should ever advocate nationalizing an industry without a clear idea of how public ownership of the sector would be better than private ownership. Nationalization cannot be viewed as an end in itself.
We also cannot afford to reject ideas just because they have been associated with conservative thinkers. One of the most innovative policies implemented by Ken Livingstone in his 8-year tenure as mayor of London was a system of congestion pricing. Under this policy, people had to pay a substantial fee for driving in the most densely trafficked areas of London during the business day. This policy hugely reduced the congestion and pollution in large portions of the city and led to much wider use of mass transportation, as well as an increase in bicycling and walking.
Congestion pricing was first promoted by Milton Friedman, the patron saint of conservative economics. Yet, no one could question Livingstone’s credentials as a committed progressive. The centrist leadership of the Labor Party in the 1990s essentially threw Livingstone out of the party for being too far left, forcing him to twice win election as London’s mayor as an independent candidate.
There are many other useful policies that can be appropriated from conservatives. Some form of a carbon tax, a market-based mechanism, is likely the most efficient way to reduce greenhouse gas emissions. In the United States, rent-subsidies, as opposed to public housing, is almost certainly the best way to ensure that low- and moderate-income families have access to decent housing. Progressives should be prepared to consider these and other policies that rely on markets to accomplish important goals.
At a macro level, we have to design policies that recognize and work around existing constraints rather than deny them. In the euro zone, governments will have to live with serious constraints on their budgets, unless they can push Germany and its fiscal conservative allies to change course. That is not likely to be a pretty picture for many countries, it certainly is not for Greece, but it doesn’t make sense to make promises without any realistic way of delivering them.
Some mistakes in designing and executing policy are unavoidable. But mistakes due to adherence to outdated dogmas or refusal to confront reality are inexcusable. We have seen progressives make far too many mistakes that fall into this category in recent years.
