Forget Europe – the markets hold the real unaccountable power

An unholy matrimony between finance and politics has undermined democracy: it's time it was reinforced

• 
• • Mark Serwotka
  • guardian.co.uk, Thursday 24 January 2013 19.30 GMT

'We still have the tin-hatted Conservatives with no heart, their Lib Dem counterparts without the brains to realise they’re sealing their own fate, and a Labour party still lacking the courage to put up a real fight' … The Wizard of Oz at West Yorkshire Playhouse. Photograph: Tristram Kenton

Listening to economics being discussed in the media is like being read a fairy story. In any fairy story you need a monster, and in this case it's "the markets": unseen, but seemingly all-powerful. Job losses, public service cuts, wage freezes, privatisation, even cuts to benefits for disabled people can be justified by saying "the markets" demand it.

But what are the markets? Who comprises them and why are they so powerful? I didn't vote for them and I doubt you did either – yet they apparently have the power to dictate policies to elected governments and, in the case of Italy, to even select the government.

This is not an abstract debate. If we are to understand the economic system we live under, what went wrong to cause the crash, and how we are to change it, we need to deal with facts, not myths. At the height of the crash the curtain was pulled back, Wizard of Oz-like, to reveal the markets as nothing more than a cabal of rich men serving their own interests.

Yet sadly, we still have the tin-hatted Conservatives with no heart, their Lib Dem counterparts without the brains to realise they're sealing their own fate, and a Labour party still lacking the courage to put up a real fight.

If people don't understand these things, they are susceptible to the argument that "there is no alternative" and that the medicine of austerity is unpalatable, but necessary.

Do you remember when in 2007 people queued outside hospitals desperate to remove their loved ones from the unsafe hands of doctors and nurses, or when in 2008 the entire public sector stood on the precipice due to the excessive greed of jobcentre workers and teachers?

No? Because it never happened. Yet the myth that the public sector caused the crash was allowed to develop, and the dangerous conclusion allowed to take root that hacking back the public sector would solve the crisis. It hasn't and it won't – as even the IMF is beginning to realise.

The myth-making, the diversionary tactics, the crash and our failure to recover from it is the story of how the finance sector came to be lauded by all major political parties.

But it also had another effect, to undermine democracy. The unholy matrimony between finance and politics jettisoned public interest in three key ways:

Firstly, deregulation. Successive governments created markets for the finance sector by removing restrictions on what the sector could do. By the crash, the regulators barely understood the complex structures they were supposed to be regulating.

Secondly, it redistributed wealth to the rich. Through slashing corporation tax and the higher rate of income tax, the super-rich grabbed an even larger share of the national wealth. This meant more wealth accumulated to fewer and fewer people. Instead of funding public services – starved of cash during the Thatcher years – more of British capital poured into the City of London.

The third and final element was privatisation. Entire industries – from the railways and telecommunications, to gas, electricity and water – were taken out of collective public ownership. This transferred power over them from the ballot to the wallets of a few, the directors and shareholders who have extracted billions from them.

This week David Cameron made a speech about the need to repatriate powers from Europe. Sections of the press and Ukip leader Nigel Farage rant incessantly about the alleged influence of Brussels over our lives, but that pales into insignificance compared to the unaccountable power of the large financial institutions.

So a few vocal Little Englanders have forced the prime minister to respond to their agenda. When what we really need is to assert our democracy over the tyranny of the markets, in the interests of the many.

Medical Research Fraud

Cambridge is top university for 'sugar daddy dating'

More than 150 female students at Cambridge University signed up for "sugar daddy dating" to help pay their tuition fees last year, according to an online dating website.

Suger daddy dating: 168 female students at Cambridge University signed up for "sugar daddy dating" last year. Photo: Juice Images

By Andrew Marszal, Digital Education Editor

10:51AM GMT 22 Jan 2013

61 Comments

More female students at Cambridge University signed up for "sugar daddy dating" than at any other British university last year, according to an online dating website.

Some 168 Cambridge students joined SeekingArrangement.com – a controversial US-based internet dating website which matches attractive young women with wealthy, usually older men – last year. Eight of the other top 20 universities using the website were based in London.

SeekingArrangement.com is frequented by male business executives on an average income of £170,000 per year. Women who sign up can agree to exchange their time and affection for lavish dates, expensive shopping trips and, in some cases, regular cash allowances.

The website – which specifically targets university students by offering a free premium membership to users with a university email address – also reported a 58 per cent increase in all university students enrolling in 2012.

The current academic year is the first in which undergraduates can be charged up to a maximum £9000 in annual tuition fees. According to the website, the average female university student using the website receives £5000 per month from their "benefactors" to "cover the cost of tuition, books and living expenses". 

“College should be an opportunity to expand the mind and experience new things," said Brandon Wade, CEO and founder of SeekingArrangement.com. "Unfortunately, because of the of recent tuition hikes, the college experience has become greatly unbalanced.”

He added: “While some may argue that these women are just using men for their own personal gain, I believe that they are proactive in pursuing a higher education.”

Although a survey conducted last year by the website found approximately 80 per cent of all relationships conducted through SeekingArrangement.com involve sex, Wade has rejected criticism that the nature of the site could be interpreted as a form of prostitution.

Speaking last year, he said “sugar babies” – young women using the website – were “intelligent and goal-oriented ladies, while sugar daddies are respectful gentlemen.”

He wrote on his website: “Because the relationship between a sugar daddy and a sugar baby is romantic in nature, most sugar relationships will likely involve 'sex' ... And because a sugar daddy is expected to be the generous gentleman, 'money' will always be spent on the sugar baby. I don’t see anything wrong (or illegal) with that!"

University students now comprise 44 per cent of the site's worldwide membership.

'Old people should hurry up and die', says Japan deputy leader

Taro Aso, Japan's deputy prime minister, has been forced to pedal back from a suggestion that old people should "hurry up and die" to save the state the cost of providing them with medical care.


Mr Aso, who has a reputation for speaking indelicately, was commenting at a meeting of the National Council on Social Security Reforms on Monday on the heavy burden imposed on the nation's finances by prolonging patients' lives with treatment.



Describing patients with serious illnesses as "tube persons," Mr Aso, who is 72, said they should be "allowed to die quickly" if they want to, Kyodo News reported.



"Heaven forbid I should be kept alive if I want to die," he said. "You cannot sleep well when you think it's all paid by the government. This won't be solved unless you let them hurry up and die."



Mr Aso later issued a statement retracting some of his remarks and admitting it had been "inappropriate" to make such comments in public.



Mr Aso became renown for his asides during a brief stint as prime minister in 2009, during which he told a group of university students that young people should not get married because they are too poor and are therefore not worthy of respect from a life partner.

 That insight was followed by the declaration that followers of the world's religions should learn from Japan's work ethic.


"To work is good. That is a completely different way of thinking to the Old Testament," Mr Aso said in January 2009. "We should share that philosophy with many other nations."



Three months previously, he offended doctors by saying many of their number "lack common sense." The same day, he upset parents at a kindergarten by informing them that parents are often the ones that need to be disciplined, not their children.



Mr Aso also managed to offend the Democratic Party of Japan by comparing it with the Nazi Party, people with Alzheimer's disease and China, which he described as "a significant threat."

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