Just to be clear, I regret my earlier post and should not have concluded with that point. ‘Othering’ people, reducing them to the status of an ‘out group’ never goes well. It’s a step in the way to making it acceptable to use violence against them. So I went too far.
Still think what Truss’s approach illustrates is what a lot of people these days implicitly recognise, that we all now exist to serve the needs of the market rather than the other way around.
So if a country tries to regulate the private sector or to increase taxation to pay for, say, health and welfare services, they run the risk of the currency traders, stock and bond traders, and those who make investment decisions for multinational companies heading off in a different direction, taking with them the investment capital that countries covet.
When capital is internationally mobile, raising taxes to pay for public services therefore runs the risk of triggering capital flight to places with comparable investment prospects but lower taxation.
What bothers me is how this situation has been allowed to develop in such a way to begin with. Am not in favour of abolishing markets, only attempting to restrain them, as there is some evidence that capitalism has actually reduced poverty in some of the very poorest countries (though not the situation of the poorest of the poor). But maybe that is no longer possible.
This is something that the economist Joseph Schumpeter appears to have foreseen in the sense that he recognised that off-the-leash capitalism does not work to maintain the cohesion of society. Left to its own devices, it is corrosive of that cohesion because of the inequalities that it generates. That is why he thought that capitalism needs restraining. Government intervention is required to balance the dynamism of capitalism with social stability. The same is true of global markets at the present time.
www.theguardian.com