Neoliberalism gave rise to Europe’s anti-migrant sentiments and put Donald Trump in power. It’s time to put an end to the model, writes PAUL DONOVAN
THE inequality cause by the neoliberal economic system has led to Donald Trump in the White House and given rise to rightwing, anti-migrant populism across Europe.
Now the time has come to start rolling back this damaging ideology before it is too late.
The operation of neoliberalism for the past 40 years has brought the world to a situation where a small group of ever-wealthier people control ever greater riches while masses of people become poorer.
This situation is a complete reversal of the way things operated under the post-war economic settlement, when there was a gradual closure of the gap between the very rich and everyone else.
The continuation of the post-war Keynesian economic model was moving toward shorter working weeks, more leisure time and earlier retirements.
Then came the neoliberal governments of Margaret Thatcher and Ronald Reagan which slammed this progress into reverse.
Inequality grew, people worked longer for less and retired later and later.
The first fissures of the neoliberal model became apparent with the banking crisis of 2008. The elites dealt with this by ensuring that the masses paid for the bankers’ recklessness. The ultra-rich once again came out very well.
In Britain, the austerity narrative was vigorously forced down our throats. In a strange way the British seemed to want to believe it.
Despite austerity measures spearheaded by David Cameron and George Osborne, the reality was that the deficit continued to grow and public services continued to be privatised.
More recently the dissatisfaction of the masses has been evidenced by the EU referendum result and the election of Trump.
More and more people are unhappy because they have become the victims of this unfair, unequal system.
Courtesy of a billionaire-owned and corporate-financed media, another fairy tale has been forced on Britain.
The electorate was lied to, resulting in many believing that their problems were due to immigration and the EU.
There are valid reasons for leaving the EU but they were not the ones for which many thousands of people voted in June.
Brexit, no matter what the left in Britain might say, was sold on the back of anti-migrant xenophobia.
A similar feeling of disenfranchisement by the elites occurred in the US, resulting in the election of Trump.
The weakening of the trade union movement has also contributed to this unequal society. Unions play a key role in ensuring a more even distribution of wealth.
The legalistic restrictions continually pursued by Conservative governments and not rolled back by the Blair-Brown Labour governments have contributed to a weakening of the trade union movement.
The only way to start rolling back the present inequality is to create a new economic system.
Some suggestions to get us on the way would include taxing the rich and corporations more heavily. It is a scandal that while tax payers pay to educate the workforce, corporations then employ that workforce but often pay little tax by way of recompense.
The implementation of a higher living wage and bringing in a universal basic income (not at the cost of the welfare state) would also help.
Trade unions need strengthening and basic labour standards need enforcing, so that those in work cannot be undermined by bringing in other labour from outside the country.
These suggestions are a very basic start. What is required is to build a whole new alternative model, drawing on some of the better elements of policy in the last 70 years.
Failure to do so will see inequalities and discontent continue to grow, resulting in more Trump-like scenarios and when these are also seen to fail, a more violent and sporadic outburst of frustration on the streets.
It is in everybody’s interests, from the rich to the poorest, that a new more equal economic system is developed.