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What would Xi do?

When it comes to infrastructure projects, Britain has become something of a global laughing stock.  And it isn’t just high-profile failures such as HS2 or the Hinkley Point C nuclear power station.  Even relatively simple projects such as making Britain’s railway system more accessible to disabled people – mostly just installing prefabricated ramps to existing stations – are behind time and over budget.  And let’s not get started on our potholed roads and sewage-congested storm drains.  In modern Britain, everywhere we look we see a growing inability even to maintain existing infrastructure, let alone build anything new.

Despite the growing catalogue of failure, however, there has been little discussion of the reasons for it.  A certain, somewhat deranged, minority will find a way of blaming Brexit, even though the trend predates the 2016 referendum and the UK leaving the EU in 2020.  Others, who see the world through the Punch and Judy show of party politics, will make the implausible claim that none of this would be happening if the seating arrangements in Versailles-on-Thames were different.  The media will find a way of blaming it all on workshy welfare recipients and/or swarthy immigrants, while libertarian thinktanks blame it on state regulation.  This though, is no more than failing to see the wood for the trees.  Since, while all of these factors may have a role, this is one of those situations where Stafford Beer’s maxim applies… “the purpose of the system is what it does.”

In lenocratic Britain, failure is by design.  Consider the two big – failed – infrastructure projects above.  The former has been all but cancelled having wasted some £27 billion so far and may well exceed £100 billion to connect outer London with outer Birmingham, while the latter is £10 billion over budget so far, and is unlikely to provide a watt of power before the end of the decade.  Compared to China, which is building infrastructure across the world, which has connected more than 150 cities via a massive high speed rail network, and which routinely builds nuclear plants in less than the global average of six years, it is clear that the UK is failing on purpose.

To understand this, simply ask cui bono?   Although Britain tends to avoid direct bribery, it is naïve to believe that our politicians are not bought and paid for.  This may not often be in the form of used banknotes in brown envelopes, but it regularly comes in the form of campaign donations, second “jobs,” book advances, and post-politics sinecures.  And while the public purse can only offer a salary of £91,346, corporate lobbyists can offer much more.  So that, in the immortal words of Upton Sinclair, “It is difficult to get a man to understand something, when his income depends on his not understanding it.”  That is, if MPs had a financial interest in getting infrastructure projects done, they would do so.  The fact that they do not is at best evidence of their turning a blind eye, and at worst of direct collusion.

The same goes for the various inspectorates and regulators, supposedly paid to represent the public interest but more often in thrall to the corporate interests they are meant to police.  Again, this is seldom so grubby as briefcases stuffed with cash changing hands.  However, the simple fact that the only career path available to these relatively lower paid public officials is to join the corporations they were previously regulating, and it goes without saying that officials who take enforcing regulation too seriously seldom secure corporate employment later on.

Then there are the senior managers of the infrastructure project corporations themselves.  Usually enjoying six – and sometimes seven – figure salaries, together with bonuses, share options and golden parachutes, the longer they can milk a project, the more they stand to gain… irrespective of failure.  We saw this in action earlier this week, when the CEO of near bankrupt shit-spreading corporation Thames Water took a £195,000 bonus despite helping to bankrupt the company.  In the absence of serious penalties, the incentive will always be to stretch out a project for as long as possible.

The big winners in all of this though, are our banking and finance overlords, who get to generate the funding for these projects out of thin air in the form of interest-bearing loans.  When people think of usury, they often imagine loan-shark type characters charging exorbitant rates of interest.  But this is only what an amateur usurer does, since it quickly bankrupts a victim.  A professional usurer – and the modern banks are the elite among the pros – sets an interest rate which is just low enough that the victim – in this case, the tax-paying public – will continue to pay… even as project delays cause the loan to be rolled-over time and again.  Thus, for example, while the anticipated end cost of HS2 was around £108 billion, the interest (if funded via government bonds) at, say, 4% over thirty years will provide a return to the banks of some £237.6 billion (far more if loaned directly by the banks)…  so, obviously, there is no incentive on the lenders to have infrastructure projects completed on time and within budget.

Because of the way the neoliberal revolution has corrupted everything it has come into contact with, this leaves the public as the helpless victims of the system they naively voted into existence.  As The Honest Sorcerer put it recently:

“The system has a fatal flaw, however.  Notwithstanding all the fluffy rhetoric — but fully in line with neo-liberal economics — none of its institutions and companies are driven by a purpose, other than making a profit and thereby accumulating more wealth and power.  Thus when its more profitable to produce costly boondoggles, rather than systems that are easy to use, require low maintenance and most of all: cheap to produce, the former will be selected.  Always.  The same goes to producing low tech, easy to repair, sturdy household equipment, as opposed to ‘smart’ refrigerators giving up the ghost in less than a decade and costing a fortune to bring back to life.  And when the feedback loop closes in legislature creating a permanent demand for such boondoggles, the circle becomes hard to escape.  This relentless profit and rent seeking has turned the economy into a wealth pump: with ever costlier to maintain institutions, endless wars waged for the enrichment of the few, and companies hardly doing useful products or services anymore.  And when you add resource depletion to this picture (i.e. running out of cheap and easy to produce raw materials and energy), outsourcing manufacturing to places where material, energy and labor inputs are still cheap looks like a fantastic idea…  Unless you consider that your economy will eventually become wholly dependent on imports, ending up producing nothing it needs, except more billionaires vying for power, and even more ‘elites’ with student loans to pay.”

Since – in the west – this will not be brought to an end by political means, it will be the financial exhaustion of the tax-paying public and small business base which will do the job.  Put simply, the more the corporations raise their prices, and the more government raises taxes, the more households and small businesses will be forced to stop spending… bringing the whole house of cards down.  And since it is increasingly obvious that this is how things will unfold – starting in the discretionary sectors of the economy – it is all too easy to dismiss politics as an irrelevance, since “the uniparty” is always in charge.

This though, may also be a delusion caused (and promoted?) by the neoliberal regime.  I referenced Chinese infrastructure above, because – while accepting that China has problems of its own just now – China’s very different politics has had a dramatically different outcome when it comes to infrastructure.  Indeed, in its way, China has been to the twenty-first century what Britain was in the nineteenth.  Not only using its access to energy and technology to construct its own infrastructure, but also developing the infrastructure of a large part of the non-western world as well.

Whatever else president Xi might do, faced with the UK’s atrocious record on infrastructure, we can be reasonably sure that not one of those who has facilitated these gross levels of corruption would still have a job on Monday morning.  Indeed, given the tales of re-education camps and summary executions, a large number of them would likely be thankful to still have their heads attached to their necks on Monday.  That is, to paraphrase and respond to Upton Sinclair, “it is hard for a man to forget his public duties when a gun is pointed at the back of his head.”

Obviously, nobody (with the exception of Tony Blair, apparently) would want to embrace a dictatorial and authoritarian regime just to get the trains running on time.  But clearly, without some form of sanction against the systemically corrupt, only an economic collapse followed by the unravelling of our critical infrastructure awaits us.  Stopping short of firing squads and camps, a spell in jail for the worst offenders along with the revocation of pensions and the confiscation of salaries and bonuses for the rest, might serve to refocus priorities on the public good rather than private greed.  But the only means by which such sanctions could be imposed is through a change of regime – preferably via the ballot box – to something that acknowledges critical infrastructure as an essential public good aside from – and ultimately supportive of – the market economy.  And in the event that our critical infrastructure collapses before the regime is changed, then the method of regime change may prove to be far less gentle.

As you made it to the end…

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