March 18, 2001

A Bolshevik never flew on one left wing

Posted in International Economy ·

Liberty is precious, so precious that it must be rationed — Vladimir Lenin, 1920

On a recent visit to Russia I was introduced to a gent called Vladlen Topov. Topov, in his early 50s, was born at the height of Stalin’s postwar purges.

His parents, petrified of being fingered as counter-revolutionaries, chose the exotic sounding Vladlen rather than a more typical Russian name such as Sergei, Alexander or Pavel. Vladlen is a truncated version of Vladimir Lenin and its emergence as a first name in the 1940s was evidence of the fear of the average Russian and tells us a thing or two about Lenin, his ideology and his friends.

Given that the Bolsheviks were unwelcome in all strata of Russian society, their survival could only have been secured by a monumental abuse of power. The ferocious revolutionary police were organised by a Polish nobleman, Felix Dzierzynski, who made Robespierre look like a pansy.

From the tsar to faceless, nameless multitudes, people were killed as ‘class enemies’, and almost overnight, every organ of the economy came under the control of Bolsheviks. Popular support was rarely countenanced except when the Bolsheviks could appeal to patriotism.

For example, when the Poles recaptured Kiev in 1919, these atheist communists dispensed with all ideology. Lenin called for the defence of Holy Mother Russia and Trotsky for the enlistment of all tsarist army officers. Extreme necessity is the mother of extreme invention and when in doubt ditch the slogans.

Fast-forward 70 years and it is still quite amazing to hear politicians and commentators talk about the left wing and the right wing as if these terms meant anything. The other night I heard one of our senior politicians talk about the “challenge for the left” with all the gravitas of someone who was actually making sense.

This is perplexing, as the set piece ideological stuff is over. In many ways it passed us by, as our two main parties never stood for any big ideology. But the charade is being maintained, both in the media and in the Da(il, with people being labelled right-wing or left-wing or new right or new left on an almost daily basis. Indeed, the confusion has reached the very top where Ireland has a self-professed free-market-loving finance minister presiding over a socialist one-size-fits-all partnership model without a blush or a smirk.

Arguably, over the past few years, three global factors have emerged to render meaningless the ‘right’ and ‘left’ labels.

The first and most crucial is the dissemination of capital and credit. In the past, owning capital distinguished workers from employers. Employers would pay workers as little as possible, getting the biggest return for their capital.

In recent years, all this has changed. Capital is ubiquitous. In this country, with real interest rates negative, capital is more or less free. The fact remains that access to capital is no longer the preserve of a minority. Now, we’re either all workers or all capitalists.

Second, this proliferation of capital seems to have led to longer business cycles. These cycles determine whether a government can be generous or not, and as many commentators still default to the simplistic slogan of ‘all left-wing governments generous, all right-wing governments mean’, this latitude for largesse is crucial.

In this regard the recent economic history of France is particularly intriguing. Today, due to a healthy business cycle, Jospin’s socialist government is cutting taxes and redistributing less. Five years ago, Juppe’s right-wing government was raising taxes and redistributing more.

The reason the left-wing government is acting like a right-wing one and vice versa is the business cycle. Jospin is cutting taxes because he can; Juppe was raising taxes because he had to. It is the business cycle, not some ideological disposition, that determines the latitude for policy.

Third, access to capital is a form of liberation. Ideas and concepts, if good enough, can be financed and profits generated. We see more social mobility within countries and less rigid and less predictable growth patterns among countries. Ireland of the 1990s saw both these developments.

So where does all this leave left-right politics? On the face of it, pretty redundant. The key to politics in the years ahead will be the use or abuse of power. The crucial questions will not be about ideology but about competence. Can these guys manage things? If yes, vote them in; if not, don’t. Do this crowd trouser money? If yes, vote them out; if no, give them a chance.

As the state gradually disengages from direct involvement in the economy, its power will reside in more esoteric issues such as regulation and licences.

Here, the potential for an abuse of power is huge and the right-left labels are again irrelevant. Take a crusty old ‘right-winger’ such as Suharto in Indonesia or a fresh-faced ‘right-winger’ like Salinas in Mexico. Both made billions from extorting money for licences as did dodgy old ‘left-winger’ Milosevic in Yugoslavia. Although these regimes were ideologically separate, in practice they were identical.

A less extreme but equally instructive example is that of the two giants of recent European politics, Francois Mitterrand and Helmut Kohl. One left and one right, both responsible for creating a network around them which lent itself to the abuse of power.

At the moment there is no such thing as a left-wing or right-wing government. Is there any difference between Blair and Hague on the economy? Not really. Is Gerhard Schrider, the tax cutting ‘left-wing’ German chancellor any different from his Christian Democrat opponent? Hardly. In the forthcoming Italian election, the so-called right-wing Silvio Berlusconi intends to spend more government money while the left-wing incumbents intend to keep government spending in check.

In ten years’ time, it is highly likely that the single biggest determining factor will be how governments use power and how transparent that use becomes. The more open and visible the system, the richer the economy.

The counterbalance to bad government will be open and independent regulation and a strong and fair legal system which penalises abuse of government power.

The US with its tough financial regulation and hard line on tax offenders, goes some of the way, but so, for that matter, does Sweden, where the system is so translucent that anyone can ask to see the tax affairs of anyone else merely as a matter of curiosity.

The old right and left labels just won’t fit any more. Maybe that time has already come. Is there any difference between left-wing Ruari Quinn, right-wing Michael Noonan and leftish-rightish Bertie Ahern on any economic issues?

  1. Rob Clancy

    That just about sums things up. The right-left debate is
    tired and past its sell-by date.

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