by

Prem Sikka
Professor of Accounting, University of Essex
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Major changes have been reshaping the political landscape of liberal democracies. An increasing number of people are shunning the ballot box. A large number of people do not appear on the electoral register or are not interested in casting their vote.

The disillusionment with contemporary politics is not hard to grasp, especially as the political clock is being turned back. Not so long ago, the rich people ruled upon and for ordinary people. Numerous social struggles challenged it. The Reform Act of 1832 gave the right to vote to men, but only on a restrictive property ownership qualification. This was swept away by the Reform Act of 1918 and its subsequent amendment in 1928, which gave voting rights to all men and women, regardless of  the ownership of property. Some hoped that this would shift power away from the monied classes to the ordinary people. But such dreams have rarely been realised.

The new rich are the major corporations. They wield more economic and political resources than many nation states. The Conservative and Labour Parties are increasingly financed by big business. £5,000 buys a lunch-table meeting with the Party leaders and a word in their ear. As Peter Mandelson knows major businesses (in this case, accountants Ernst & Young) can also provide lucrative consultancies to former and potential Ministers. Big business overlords are not in the habit of giving away their money without getting something in return. So cigarette advertising is bad unless Bernie Ecclestein can donate a million pounds to New Labour. Ethical foreign policy or otherwise, big business's arms exports are not to be disrupted. Offshore havens are bad unless Geoffrey Robinson has money in some or the Conservative Party Treasurer, Michael Ashcroft, happens to live in one. All producers of goods and services have to owe a 'duty of care' to consumers, unless the business happens to be accountancy. In the age of privatisation, the government itself has been put up for sale to the highest bidder.

By 'capturing' political parties, the privileged few are able to ‘capture’ policymaking arenas to secure favourable distribution of wealth and enjoy opulent consumption. They demand privatisation of publicly-owned industries, low wages for workers and a flexible labour force with few rights. The gap between the rich and the poor is increasing. The gap between the highest-paid and the lowest-paid workers is greater than it has been for at least fifty years. A recent paper issued by the Department of Social Security acknowledges that the “proportion of people in low incomes in absolute terms has remained roughly constant since 1979 despite average income growth of over 40 per cent”. But the government has no proposals for redistribution of wealth. The equitable distribution of wealth is unfashionable at the end of the twentieth century as it was at the beginning. The dreams of democracy, equality, social justice and an egalitarian society have been replaced by a kind of  ‘reverse socialism’ where the poor pay a greater proportion of their income in taxes (direct and indirect taxes) to finance economic gains for the rich.  By appropriating an inequitable share of wealth the wealthy are able to opt out of the public provision of education, health, policing and security by substitution of their private goods.

An unwritten rule of government was that business overlords could lobby but not be able to draft their own legislation. Perhaps, some businesses even feared the critical scrutiny of some maverick MPs and backbenchers. All that is now changing too. Most MPs are simply used  as fodder for nodding through legislation and legitimising the power exercised by the big business. Without ever being elected, Lords Haskin, Simon, Sainsbury and others were elevated to senior government positions. This enabled them to decide government priorities and legislation. The issues relating to democratising corporate governance, worker directors and curbing fat cats have been organised off the political agenda.

In government circles, the rhetoric of higher profit, higher share price, dividends and efficiency takes precedence in a manner that is fundamentally at odds with the democratic principles of justice and fairness. Political discourse is being increasingly shaped by corporate interests, whilst alternative voices are being silenced, muted, or excluded altogether. By privileging the voices of the corporate elites, the political system has disenfranchised ordinary people.

Unsurprisingly, the political system is not held in high public esteem. In this vacuum, people are organising to fight single issues ranging from the environment, gay liberation, animal welfare and local matters. This does not amount to any coherent political programme for combating broader social ills and inequalities. The deepening inequalities and exploitation require reflections upon the crisis of liberal democracies. The increasing challenge for the left is to reconstruct democratic politics by privileging the principles of justice, fairness and equality which can become the ‘fermenting agents’ for securing a fulfilling life.