According to my private dictionary, an ‘idiotology’ is an -ology made for idiots or (its other meaning) devised for idiots by those with nefarious motives in mind. It may start with a bright idea, which, like a dodgy light bulb, flickers and fades, which is where true idiots come into their own. Instead of changing the bulb, they fiddle around with fuses and switches, until the whole neighbourhood is in darkness, at which point they blame the government.
An example would be Brexit. I can understand the attraction of Brexit: I too have Ruled the Waves on the Last Night of the Proms. But I am not an expert in this field. I have not received the right training. I fidgeted while Daniel Hannan was talking and questioned the slogan on the Boris bus. I could not understand why our businesses would benefit from leaving the world’s largest trading zone, or why the European Court of Human Rights might cause the decline of Britain as a world power: the further reaches of idiotology were beyond me.
Privatisation – the answer to everything?
I had a similar problem with privatisation. It seemed a good idea to sell off the ‘family silver’, as Harold Macmillan put it, to reduce the burden on the taxpayer. Who needed these glittering pots? The assets that Mrs Thatcher had in mind were the national services, such as the railways, electricity, water and sewage, airports, North Sea oil, British Telecom (BT) and the Royal Mail. These could not be, strictly speaking, sold. They lived here. The rights to manage them, however, could be ‘outsourced’ to private companies in exchange for suitable sums of money. It was a good way of attracting foreign capital into Britain, a double whammy of its kind.
It is a sad fact that few investors are altruists. They like to see some return for their money, which is why, in the not-so-long term, their dividends start to exceed their outlay. Privatisation, which began with the rush of new money, soon became a drain upon the nation’s resources. There have been many studies of what David Parker from Cranfield University called The UK’s Privatisation Experiment (2004). Few were complimentary. According to Massimo Florio from Milan University, in A State Without Ownership (2002), British taxpayers suffered a £14bn loss on their assets, which were transferred to shareholders.
Healthy competition
Money, of course, does not tell the full story. There were other benefits of privatisation, such as competition, new technology and the tiresome restrictions that governments like to impose when they are trying to please the electorate. Parker provided a long list of the various pros and cons. The list has now increased, exponentially, as they say in the trade.
Competition was a mixed blessing. Once a contract had been given to Thames Water, there was little chance that other companies would spring up, wanting to install an alternative pumping station or sewage farm. If it went wrong, there were few rivals ready to take over. It was a de facto monopoly. Other services were strengthened or handicapped in a similar way. If something went wrong, they had to be bailed out by the taxpayer.
The iron rules of the marketplace disciplined institutions, such as the Royal Mail, which had served the country well since the introduction of the penny post in 1839. It was split up, and sold off, and is now a subsidiary of International Distribution Services, owned by a Czech parent company. The old post offices, symbols of my childhood, were brought up to date with the introduction of the latest technology, Horizon, installed by a Japanese company, Fujitsu. There were some technical hitches. The lives of seven hundred post office managers suffered accordingly. After twenty or so years, they are hopefully waiting for compensation.
Long live freedom
Privatisation was never merely a matter of mundane management. There was a moral imperative as well: freedom. The out-of-date philosopher, John Maynard Keynes, once proposed that the public and private sectors of the economy should work together. The state should provide the national services, offering a social framework within which the private companies could thrive. Did Keynes not realise that meddling civil servants might interfere with the plans of the freedom-loving entrepreneurs and prevent the well-off from becoming very, very rich?
Long live BT
Such services should be profitable. There was no reason why the nationalised industries should always run at a loss. The obstacles were party-political, not organic. In the early 1980s, researchers from the Home Office advised Mrs Thatcher’s government to install broadband as a public service. Other countries were doing so. Optical fibre cable opened a range of on-line possibilities, which the young inventors in Silicon Valley and at CERN in Switzerland were eager to explore. BT was well-placed to install broadband and the taxpayer, as well as private companies, should benefit from its many opportunities.
But BT was on the list of national companies to be privatised. Mrs Thatcher did not want to complicate its sale with an obligation to install ‘cablevision’, as it was called. Instead, the rights to provide broadband services were auctioned appropriately and sold where there was evidence of public demand. This meant that, in Britain, the south-east benefitted at the expense of the north west – and international companies transformed the way in which we shopped, worked and flirted with each other. The social life of the country, like oil, could be turned into money in a kind of privatisation of the spirit.
Idiotology on a wider scale
We should not assume, of course, that the dividends given to shareholders are lost to society at large. As any idiotologist would explain, these gains are spread around and invested in other worthwhile causes which offer higher interest rates, thus ensuring that the democratic wishes of people are fulfilled. It would be racist to presume that their profits should always be spent in the home country. They could help to relieve the suffering in the Maldives and other tax-friendly parts of the world.
Has Britain become poorer from Brexit, privatisation and the transference of wealth from the public to the private sectors? Technically so perhaps, a loss of some 4% in the GDP, according to the Office of Budget Responsibility, or maybe a little more. But look on the bright side! We have defeated communism, socialism, Keynesianism and other -ologies of the past. Even the Russian Federation has followed the example of Mrs Thatcher and transferred the wealth of its natural resources into the hands of its oligarchs.
Welcome to the Free World of Idiotocracies.
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