Words can carry so much baggage, can’t they? Everyday words can hide complexity or cause trouble. “Independence”, for example, may sound a simple proposition and a positive aspiration – freedom from oppression; self-determination, pride – but it is an outcome actually not so easy to achieve. Is it even desirable?
Certainly, being dependent may be undesirable: dancing to someone else’s tune; having no agency; having to pay whatever price someone else decides. Readers old enough may remember the Monopolies Commission and its successors, set up by governments of all stripes to address risks to our own economy associated with limited sources of essential goods and services. Whilst companies on which the country might become dependent were UK-based, such oversight was applicable and useful, it was government itself which most egregiously breached this principle. Capitalism and Conservatives’ worship of it led this country to become more, not less, dependent and at risk.
Dependence and market failure
The marketising of everything has resulted time and again in service failure as profits are diverted not into sustaining supply but into rewarding investors in privatised utilities. Local monopolies were created, with no competition to incentivise re-investment or lower prices; and with deliberately weak regulators, corrective action has been unenforceable. Take the most basic of needs, clean water, where service failure has been the price of rewarding investors. The same has been true with the railways, which notoriously created dividend bonanzas for investors and left the state to pick up bills for the modernisation they failed to deliver. In each case, when the public service fails, it becomes necessary for the state to intervene, with the taxpayer ultimately picking up the bill. This is market failure caused by gratuitous monopolies.
Global Markets in a Fractured World
Globalisation and high-tech innovation produced dependence on companies beyond the reach of national regulators, like Google, Amazon and Microsoft. Even in markets for physical commodities, the scale required by international markets ultimately led to supply being concentrated in ever fewer hands on which individual nations now depended, without the option of local sourcing, sometimes at great risk. Even more international is the trade in money. As the Truss/Kwarteng debacle has illustrated so sharply, currency trading and investment transcend borders and can make or break a sovereign nation’s economy from cyberspace.
Independence and sovereignty
The superficially attractive notion that a country could declare itself independent with regard to even the supply of food and energy has been shown to be impracticable. History offers the example of Franco and his policy of “autarky”. After relying on resources from Germany and Italy to seize power in Spain, Franco opted for neutrality in the ensuing World War and subsequent peace, seeking self-sufficiency. He aimed to be independent of supplies from abroad, to build capacity at home and eschew foreign exchange problems. However, a low-skilled population, lack of infrastructure and limited local industries were unable to meet the nation’s needs nor to strengthen the peseta. The country was in deep poverty when in 1953 he succumbed to a major defence deal with Spain’s former adversary, the USA, bringing dollars into the country and sparking economic recovery. Going it alone was simply not feasible.
Brexit Britain was conceived along similarly flawed, nationalistic lines and has already suffered decline in currency value and trade as a result. The reliance of European countries on supplies of gas from Russia and wheat and sunflower oil from Ukraine illustrates how dependency, risk and price go hand in hand. The UK is as much dependent on commodity markets as the EU we left, but far from insulating ourselves Brexit has reduced our strength in negotiating terms in difficult times. Goods we want have to be imported either because we cannot grow them at all in our climate or because we are unable to produce or buy competitively. From soya beans to semi-conductors, from citrus fruits to sauvignon blanc, our weaker purchasing power and self-imposed trade barriers determine the prices we now have to pay.
What can or does the government of a country reliant on imports do in the face of this picture? In truth, not very much. One facet of where we are now politically is that “they” have won. Global Money has taken hold of the levers of power, with the nation’s buying power small and regulatory influence nugatory. We have failed to ‘take back control’.
Turning dependence into collaboration
Where dependence is shared there is always the potential benefit of a stronger voice, against the power of global markets, through collective action. Acting collectively gains more clout; and buying ahead prudently can buy time to address risks. But Brexit took us out of the club and the focus on financial gain has led to the failure to maintain stocks of PPE and liquid gas, by way of examples. We left the largest trading bloc in the world to become independent, in fact becoming weaker and more isolated, except from the buffets of the very markets which Conservatism worships.
If politics is about running the economy for the citizenry, then this country’s decadent governing party is failing, and its craved independence is pointless, illusory and damaging. We are and always will be in dependence, not independent.
