The Guardian’s view on broken markets: It’s time to take back control | Editorial

Othen a survey find that nearly half of Conservative voters favor public ownership of the energy industry, and a former adviser to Conservative governments describe with the energy and water privatization model broken, it seems fair to assume that a laissez-faire economic orthodoxy that has lasted more than 30 years is on the ropes.

The scale of the impending energy disaster, as bills reach unaffordable levels for households and small businesses, has been driven primarily by the external shock of Russia’s war in Ukraine. But as Sir Dieter Helm, professor of economic policy at the University of Oxford, argued in an interview with the Financial Times on Monday, the crisis has exposed the failings of a market that was not anyway not suitable for its purpose. Energy and water, he said, are “too essential to be treated like another commodity, as some of the architects of the privatization, liberalization and competition paradigm believed”.

Professor Helm favors stricter and better-designed regulation in both sectors, rather than nationalisation. But his critique of market fundamentalism succinctly captures the national mood, after a scorching and anxious summer in which sewage destroyed rivers and the sea, trains were canceled and private rents soared in a broken housing market. According to YouGov’s poll, a majority of ‘red wall’ voters who backed Boris Johnson in 2019 back the renationalisation of the energy industry. Polls have consistently shown majority support for public ownership of railways and water industry. A majority of Tory voters favor allowing councils to buy empty properties and provide more social housing.

The experience of the pandemic has undoubtedly played a role in changing the way many people view state intervention and the ethical responsibility of government to act decisively in times of crisis. The immediate popularity of Sir Keir Starmer’s proposal for an energy price freeze until March bears witness to this. But the public also scolded the tricks of privatization models that took over natural monopolies and maximized bonuses and dividends, while underinvesting in assets and infrastructure. When England’s water and sewage companies were sold off in 1989, at a shockingly cheap price, the Thatcher government presented the move as a triumph of grassroots capitalism. “You could be an H2Owner,” the ad campaign read. This right-wing version of power to the people quickly gave way to a less romantic reality as private equity and pension companies took hold. As with other privatizations, any sense of proper accountability was quickly lost in complex ownership arrangements and an industry-manipulated regulatory system. lobbyists.

Ahead of the darkest of winters, it’s clear that voters of all political stripes want a reset in the way public goods are managed and delivered. At a Labor Party conference 10 years ago, political philosopher Michael Sandel argued that “the issue of markets is not really an economic issue. It’s a question of how we want to live together. Do we want a society where everything is for sale? Beyond the environs of the surreal and disconnected Conservative leadership race, the answer to that question is now a resounding “no.” There is a palpable desire across the country to rebalance the public and private sectors and curb market excesses. Slowly but surely this is becoming the new common sense of British politics.

About Timothy Ball

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