It’s not just Ed. Their faith in competition makes all our politicians weird

It’s not just Ed.

There’s something profoundly weird about our political class. Labour, LibDem and Tory, politicians seem to move in packs. They feel safe only they use the same ideas and language as the rest of the Westminster village, even when what they say makes no sense to the rest of us.

The idea that competition between corporations is the answer to our society’s problems is a good example of this kind of bad political groupthink.

The idea began life in the 1980s. A politicians’ commitment to competition showed they were tough and serious, and didn’t mind cracking a few eggs – and closing a few factories – in the interests of reversing Britain’s long-term economic decline.

Since then, competition has become the politicians’ answer to everything, from school performance to energy companies over-charging. As a recent book puts it, ‘elite responses have become an echo chamber reverberating with one simple message endlessly repeated regardless of circumstances’.

The resurgent hard-right of the Conservative party pushes faith in competitive forces to the limit. The idea that performance improves when institutions compete was behind Michael Gove’s school reforms, David Willetts’ education policy, and the recent, disastrous reorganisation of the NHS.

Our attack is weak because our politics is framed by the same argument.

Our answer to rip-off Britain is – more competition. Ed Miliband has, bravely, and rightly, argued that we need to break up the massive concentration of unaccountable power in the banks and energy firms. But then we seem to lose our bottle, and argue that the answer comes from more competition. The cap on energy prices will give us time to ‘reset the market’ so it’s more competitive. The answer to bad banks is more challengers.

Competition is still central to the way we talk about Britain’s place in the world, too. We insist, as Ed Balls did in an otherwise very good speech last month, on retaining a ‘competitive’ tax regime. We talk about Britain being in a ‘global race’, although unlike the Tories we should be ‘competing in a race to the top’.

By championing competition as the solution to everything now, we are stuck solving today’s problems with a tool that’s forty years out of date. With their continued insistence on competition as the solution, Cameron and Miliband both demonstrate they are Thatcher’s sons, and haven’t cut the apron strings.

Our trouble now is not that industry is sluggish and inefficient, but that institutions work without being forced to answer to citizens. The problem isn’t with the market, but with the business model of firms within it. The answer is to change the way our institutions are run, not competition.

Too often, big business sucks resources out of our towns and cities, and gives workers and citizens too little negotiating power. Firms are too centralised, disconnected from the communities they are part of. In most sectors the search for short-term financial gain has undermined coordination between different parts of the supply chain. Competition simply threatens to replace one big, out of touch corporation with another. As Aditya Chakrabortty asked this week ‘what is the point of having more competitors if they’re all doing the same thing?’

Competition is the wrong frame of reference for thinking about Britain’s place in the world too. Our economy is far less globalised than people imagine. We spend most of our money on housing, food and transport and there can be no global market in any of these things. Most workers, even the richest bankers, are highly immobile. Much of the time, as Kevin Doogan argues, the idea of global competition is just an excuse to drive down wages.

Of course, all this is common sense. Competition is not common in ordinary life. Most of the time, in our jobs or family life, we get on by working together. Competition has a rare, special place, on sports days, exams, bidding to buy a house. These kinds of thing are important, but we divide them off from ordinary life. Very few compete even on their salaries (bankers are the exception). Most of us think people who treats every part of their lives as a competition are weird. But it’s amazing how often politicians ignore things that are obvious.

Now is the time for Labour to reconnect with the way real life works. We need to jettison this rhetoric, tell a clear story about how a Labour government will stop the corrosive effects of obsessive competition, and rebuild Britain’s economy and society to creating institutions where people work together. That means insisting companies are run through negotiation between workers and managers; giving power over jobs and training to local communities which can allocate resources to meet common needs; putting the voice of service users, rather than the notional ability to choose at the centre of public service reform.

The groundwork for all this is being done by Labour’s policy review, with its emphasis on devolving power to institutions in towns and cities where people work together for the common good. But the argument being made in the policy papers Jon Cruddas is coordinating needs to be brought together in a compelling story told by Ed and the rest of the shadow cabinet. That story needs to challenge the Thatcherite consensus in a way we haven’t seen yet. It must champion the idea and practice of the common good in place of competitive strife.

The argument isn’t the tired old one about state against market. It’s about creating an economy based on cooperation not competition, a politics where power is radically decentralised, a society founded not on transactions and targets but local institutions of mutual support.

It’s only politicians’ fear of saying something different which holds them back. But unless Labour makes a break, and have enough confidence to make its own arguments at last, we are doomed.

Jon Wilson teaches Indian History at King’s College, London.