April 12 2024
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‘Greensill show us that the market is not a solution to every ill’

‘Greensill show us that the market is not a solution to every ill’

To paraphrase David Hume, simply because you can do something does not necessarily mean you ought to do it.  This is something that David Cameron may be slowly coming to realise, as the repercussions of the Greensill scandal continue to play out across the front pages, dragging whatever rags were left of Cameron’s tattered reputation into the most fetid of mires.  Greensill’s modus operandi was, fundamentally, to act as the go between between the government and its suppliers. It would pay the latter the moment the invoice was issued, and then would be recompensed by the government once the invoice had wound its way through the bureaucracy of the state.  

If the government had been struggling – inexplicably – to lay its hands on the money necessary to pay its suppliers, this might have seemed like a practical solution to the problem. Yet, as the past year has made abundantly clear, struggling to come up with the readies is not a particular issue for the British state.  Instead, the more obvious solution –  taken by a number of Whitehall departments – was to simply pay invoices on time.  

But this faith in markets and their ability to remedy public sector shortcomings is not confined solely to the outsourcing of government invoicing.  Instead, privatisation is rife within the British body politick,  with governments on both the left and the right convinced that the efficiencies of the market will ameliorate the functioning of state.  Nowhere is this naive belief both more evident – and more debunked – than in the UK’s immigration detention centres (IDCs) and prisons, where corporate monoliths bid for the questionable privilege of running them.  

Here, it is the operation of the IDCs that is the more alarming, as while about 10% of the UK’s prison estate has been contracted out, housing approximately 15% of the prison population, the majority of the IDC complex is run by private companies.  These companies range from Serco, G4S and GEO – the blunt swiss army knives of the state-privatisation system – to less ubiquitous corporations like Clearspring and GSL, the former who operate the scandal-ridden Napier Barracks.   

But the outsourcing of the operation of these estates ignores an obvious flaw, which is that it bears the veneer of the market, but without the forces behind it that drive market efficiency.  For a market to operate effectively, it requires a producer and a consumer.  But as well as this, it is crucial for there to be genuine competition.  Perhaps, if one of the corporations had found a novel way of operating a detention centre or prison, whether through adopting idiosyncratic architecture, or using uniquely advanced technology, that could provide an economic justification for IDC- and prison-privatisation.  But, so far, they haven’t.  

Instead, each of the corporations blunders on in exactly the same way, delivering the same inadequate service for roughly the same price, with little to operationally distinguish corporate-run IDCs from state-run IDCs.  In essence, they function as prisons, with all IDCs constructed since 2001 built to Category B prison standard- a standard intended to keep the public safe from prisoners who pose a genuine threat, but here used to confine people guilty of no crime, and who pose no threat to the public.  

The reality of this is not lost on detainees, with some telling Mary Bosworth, the director for the Centre of Border Criminologies at Oxford, that ‘we’re like prisoners’, and protesting about how they ‘basically don’t have… freedom’.  But nor is there any motivation among the private corporations who run the facilities to improve the living conditions of detainees.  On the contrary, any motivation is likely to be to degrade the conditions, with lower living standards, whether in terms of poor quality food or limited recreation, cutting costs and so leading to greater profits, which is the primary concern of any private corporation. They answer to their shareholders first and foremost, who expect a financial, not a moral, return on their investment.  

Consequently, detainees in these centres are reduced to little more than goods to be traded for profit, stripping them of their humanity.   And this is why the privatisation of prison and detention centres is fundamentally iniquitous. Even if the pressures of the market had incentivised corporations to devise novel methods of detaining individuals, privatisation still reduces them to numbers on a spreadsheet, and the state should not be degrading the humanity of those who seek succour here by turning them over to corporations for profit.  

Instead, the state should recognise that certain obligations are vested in it alone.  And while the state may still be incentivised to keep costs low, it is driven by more than brute market forces.  A compact exists between the state and its citizens, but also between the state and others who live within its borders, and it is this compact that legitimises state powers like punishment and detention.  But when other institutions are brought in, with a more diverse range of motivations, this agreement is undermined, and with it, the legitimacy the state has to exercise its authority over people within its domain.  

In treating immigrants and refugees in this way, it others them further, dividing people into the legitimate and the illegitimate.  Constant propaganda against immigrants and asylum seekers has turned them into bogeymen, with the overblown rhetoric of the government exaggerating the threat that they pose to the British state and its people, and so terrifying the population into believing that conditions like those meted out in the Napier Barracks are necessary, and even perhaps morally right.  It is this deception that explains how Priti Patel continues to occupy one of the highest offices in the land, with a majority of the population convinced that her nationalistic, xenophobic policies that deny peoples’ common humanity, are something worth voting for, not against.  

According to Boris Johnson, Britain’s success in vaccines is ‘because of capitalism, because of greed my friends’.  But while the prime minister was condemned for this, he was simply acknowledging the philosophy that has animated British and other western governments since the 1980s. Greensill has shown us that the market is not a solution to every ill that affects the government, and that the state does not exist merely to help financiers and capitalists turn a profit.   The inquiry into lobbying should consider how this flawed philosophy has worked its way into every corner of the British government, degrading the values of the state in order to line the pockets of the wealthy.