Right now, I am not speaking, but that is being discussed:

I often suggest, when it’s asked why I write so much, that my reason for doing so is to understand the world in which I live, and as that post developed and the logical conclusions that it suggested became apparent, it became increasingly clear how great the threats that we face at present are.

Simultaneously, it was obvious that so much of the current debate on what our politicians call defence, which can be described as actions dependent upon armaments, is inappropriate in a world where by far the largest threats that we face come from the actions of the USA and Israel. Each poses a threat far greater than anything that Russia might create, and yet the acknowledgement of this is only seemingly recognised by minority parties in this country, whose bravery in doing so I welcome.

At the same time, my sense of foreboding grew. That worries me because I am, essentially, an optimistic person. That sentiment has always been based on awareness of the need to recognise, appraise, and then, if necessary, take action to mitigate risks, whether immediate or remote. It would be entirely possible to suggest that there have been short-term occasions in my life when I have underachieved as a result. I have, however, always presumed that life is a long-term game and, as a consequence, I have made a habit of prioritising long-term advantage over short-term wins. Nothing has ever persuaded me of the inappropriateness of this strategy, which has served me well.

That said, no one who has read what I’ve had to say here, in my books, and elsewhere over the last 20 years or so could doubt that I have, over that period, questioned the neoliberal folly of adopting a strategy that I think is the exact opposite of that which I have personally adopted. Throughout the neoliberal world, in our country, and within our economy, short-term gains have been chosen in priority to long-term sustainability. I have long warned that there would be a price to pay for this, and my fear now is that the day of reckoning for this folly is very close.

Perhaps I should have recognised that the USA was always going to be the place to pull neoliberalism down because it has always pursued excess to a greater degree than anywhere else, and it was always that excess that was going to destroy the structure of this particular form of capitalism, which is now at the heart of the threat to our well-being.

Perhaps, too, I should have recognised the threat from Israel, because I remember the 1967 Six-Day War, and the Middle East crisis that evolved from 1973 onwards. Israel’s unwillingness to live within its agreed international borders has been a continual theme throughout my lived memory, and that this, too, might reach a point where its aspirations created crisis should, I suspect, have been more obvious to me than it was until recent years.

That said, the sense of foreboding comes from something more. The international scene is disastrous. Our economy is heading for crisis, but what is at least as worrying is that, first, many politicians seem completely unaware of this, and, second, many people are indifferent to the fact that these things might happen because they see them as a necessary precursor to change. Far too many of that latter group also appear to want a far-right solution.

I sense that all around me. I now know that I live in a community where maybe 30% of people are willing to vote for neo-fascism, with all the cruelty that is implicit in that. Worryingly, there is nothing unusual in saying that now. Almost certainly, you live in such a community, too. That worries me most of all.

A sense of toleration has been lost. To look at a representative issue, I am aware that there has been a flood of new donations to the RNLI in response to the attacks on it, its operations to save people in the English Channel, and the threats made to its crews, but I am equally aware that many people are now deeply hostile to what it is doing. Hearts and minds are becoming increasingly divided, and that troubles me greatly.

In all this, there is a personal challenge. Do I give up, cower in the corner, and admit that I’ve been promoting something that people do not want, even though, by definition, if 30% of people are now supportive of neo-fascism, 70% are not? Alternatively, do I take a risk and continue to fight for what I think is right?

There is not really a choice in that, but I am aware of the divisions, hostilities, and sometimes straightforward nastiness that pervade this country now, and it is precisely because I am so worried that our lacklustre neoliberal politicians cannot see the responsibility that falls upon them to address the resulting crises that we face that I feel the need to keep working on things like a necessary alternative budget, as well as the book that I am writing.

I worked on both yesterday and enjoyed the writing process. The urgency, however, feels very high to me right now. I fear we are near a tipping point, where the acceptance of fascism, racism, misogyny, prejudice, and intolerance is becoming normalised. The BBC appears to me to be at the forefront of this, and that is something new, and we all have a duty to resist it. The alternatives are too horrible to imagine, for everyone, including many of those who now think such things are a solution.

The reality can be expressed in a new way:

First they came for the RNLI
And I did not speak out
Because I was not in a lifeboat crew.

Then they came for me
And there was no one left
To speak out for me.

Andy Burnham is considering increasing capital gains tax to fund a giveaway to the lowest earners.

He and the Chancellor are reviewing proposals to raise taxes on wealth to increase the income tax personal allowance, giving the bottom fifth of taxpayers a £600-a-year boost.

The strategy to pay for it, put forward by Dale Vince, a Labour donor, is a £14bn raid on investors that would align capital gains tax rates with income tax, alongside ending the interest paid on central reserves held by the Bank of England.

It would allow for a £3,000 increase in the personal allowance, which has not gone up since 2021 despite rising costs.

It would also allow Burnham to prove his commitment to tackling high living costs amid rising inflation.

No final decision has been made, but the Prime Minister has already strongly hinted at his desire to raise the allowance, saying it was the number one issue in his constituency before he entered No 10.

The question is, will it work? Some think tanks say it will – with additional tweaks to the system to mitigate avoidance. Economists, however, are likely to seize upon the policy, with HMRC’s own figures suggesting that raising the duty could cost more than it brings in.

I wonder, first of all, where Dale Vince got these ideas from? I am aware he follows my work.

Then I wonder whether Burnham is really considering this, or if the Telegraph is just spinning a submission for their own advantage.

And then I wonder just who those economists the Telegraph is talking to might be. The claim in the related article is that HMRC's own data shows equalising capital gains tax rates will reduce yield, but those are Treasury numbers, and they got us into this mess, so I put little weight on their belief in the Laffer curve. I suspect the others are in Tufton Street.

It would, I admit, be good to see further progress on the proposals in the Taxing Wealth Report.

Business is organised human activity. People work together to make things, provide services, solve problems and meet needs. Companies, markets and capital can all play a role in that process, but none of them is the same thing as business itself.

That distinction matters because it changes how we think about profit. A genuine business needs sufficient income to survive, invest and continue its activities. But that does not mean maximising profit is its purpose. Profit can be a means of sustaining a business rather than the reason why the business exists.

That then raises a much bigger question. If human work creates value, why does conventional accounting treat labour as a cost while treating the residual profit as belonging to capital?

I also look at the responsibilities businesses have to workers, customers, suppliers, communities, government, and the environment they depend on, and stress that business and capitalism are not synonymous. Understanding the difference might fundamentally change how we think about business, companies, work, profit and who should benefit from economic activity.

This video is part of my Understanding Economics series, which explains economics as it operates in the real world. You can find links to other videos in the series here.

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Hello, I’m Richard Murphy, and this is Understanding Economics, the series of videos that I’m making to explain the world of economics in the way that I see it. Now, I stress that is about the way I see economics. It is not the way in which every economist sees the world, but I want to explain that world in a way that I think you will understand and not in the absurd way that most economists present.

So, accepting that point, I am asking questions about the real world and what goes on in it. And in this video I want to ask the question: what is business? That’s because very often that term ‘business’ is confused with other forms of activity and other descriptions of types of economic organisation. And so we need to cut through and answer that question: what is business?

Well, in my opinion, business is organised human activity. It is people working together to make things, to provide services, and to earn a living. And the key word in the statement I’ve just made is ‘human’. Business exists because people have purposes and they have things they want to make and things they want to do. Businesses exist within society to meet needs, and they are dependent upon that society to do so.

Money is necessary to keep a business going, but making money is not what business is for. The problem is, people confuse a business with a lot of other things, and that’s the first issue I have to deal with in this video.

Business is not, for example, the same thing as a company. A company is a legal structure or a type of organisation created and recognised by law. In law, a company is treated as if it were a separate person from the people who own or run it. This means that if a company fails and runs up debts, the owners usually only lose what they have put into the company and not their homes or their savings. A company can also run indefinitely even when its founders are gone. But none of this tells us what the people inside the company are actually doing or why.

The company is a legal shell. Business is a human activity that might be happening inside it. But let me be clear: just because an activity is undertaken by a company, it does not mean that it is a business. There are different types of economic activity that I will mention shortly that could be undertaken by a company, and they’re not businesses at all.

Let’s also be clear. Economists often talk about a thing called the firm, which is a unit that takes in raw materials and labour and turns them into products. This is how they might describe a business, but it is not what I call a business. The reason why is that this is a description of something like a machine. It largely ignores the people, relationships, and purpose inside real organisations. And as such, it doesn’t describe that essential human element that I ascribe to business activity.

So the business is not the firm that economists describe. Nor is a business a market. A market is something different again. It is the place where buying and selling happens. So of course, businesses are present in markets, but that doesn’t mean to say they are markets.

Now, markets only work because of rules, laws, contracts, courts, a shared currency, and agreed rights over property. So, as I stress, businesses operate within markets, but they are not the same thing as the economist’s model of either a firm or of the market itself.

And business is not about capitalism. Capital means the money, buildings, machines, and assets that investors put into a business. Capitalism is not the same as capital. Capitalism is a system built around who owns capital and who receives the profits from it. Business is different. It is the activity through which people organise to make things, provide services and meet needs.

When people take real risks to build something useful, they can create genuine value for society. That is obviously true. But some large corporations, maybe most large corporations, focus less on making useful things these days and more on using their power and size to extract value or money from markets through monopoly pricing, financial manoeuvring and avoiding taxes.

Productive business and that kind of profit-seeking activity have very little in common. That’s the critical point I’m making. Capitalism does not equate to business, and business does not equate to capitalism because capitalism describes a particular form of money extraction and business describes a form of productive activity.

And when we come to business, let’s be clear: purpose comes before profit. People usually create businesses because they want to do something. They want to make a product, provide a service, practise a craft, or pursue an idea. And I have, in my career as a chartered accountant, advised hundreds and maybe thousands of such businesses over time. I have also been a business person.

A business must bring in more money than it spends if it wants to keep going, and that surplus is called profit by economists and profit is therefore necessary for survival and growth. But needing profit to survive is not the same thing as making profit the whole point of business activity.

Economists who claim that business activity is all about profit have almost certainly never been near a real business. And they most certainly will never have run one, because anybody who has will know that profit is not the day-to-day focus of any business. Keeping the thing going is. Profit helps that process, but it is by no means the sole focus of attention inside any genuine business activity. And that is because it is people who create value.

Value here means something useful that meets a real need or improves someone’s life. It is tangible. Value in business is created by human skill, effort, knowledge, care and judgement. Work is therefore at the heart of what makes a business productive. That is why profit is not, because it is work that is the focus of a business activity.

Yet standard accounting treats wages as a cost to be subtracted from income, leaving what remains as profit for the investors. That, though, is a choice and not a law of nature. I’m questioning whether that is right, in the case of genuine business activity. There is nothing inevitable about this choice. What is left could just as easily belong to workers as it does to capital, and I am genuinely wondering whether it should. Have we got accounting right in that case? We might be accounting for capital when we construct accounts in the way that we do now, but business, as I’ve already said, is not the same as capital or capitalism. It’s an entirely different form of productive activity.

But at the same time, let’s be clear, business has obligations, and these should be reflected in its organisation and in its accounting. No business succeeds by itself. It depends on workers, customers, suppliers, and the communities that surround it. It also depends on public infrastructure such as roads, schools, education, and hospitals, as well as on law, courts, and money created by the government. It uses natural resources, and it affects the environment. Business, therefore, has a responsibility to all of these groups and not just to those who own it.

The idea that the shareholders are paramount is, therefore, for the fairies. It is nonsense. It is untrue, and as a matter of fact, it is not what is reflected in UK company law.

There’s a final distinction to make, and that is that not all businesses are alike. Small businesses are usually connected to their founders’ purposes, their own money, and the communities they serve in which they exist, and from which they draw their main resource, which is people.

Large corporations often work very differently. They can use their size and market power to set high prices, avoid taxes through offshore arrangements, and shape political decisions in their own favour.

But size alone is not the issue here. Co-operatives owned by their members and mutual organisations, such as some building societies, as well as public bodies, can also operate at scale while serving broader purposes.

What really matters then is what the purpose of the organisation is, who might own it, and what is it trying to do?

This is what matters. Doing something is what identifies a business, and so too does how it is run identify a business, because if it is run to create something genuinely useful, that is a business activity. If it is run to simply extract money from others, that is capitalism, and this distinction is real and has to be remembered.

Business is organised around human purpose. Profit is necessary if a business is to survive, but it is a tool and not a goal. Business is worthwhile when it meets genuine needs, creates real value, sustains livelihoods, and honours the society and planet on which it depends. That is what defines it. Everything else is something else.

This is one of my Understanding Economics series. You will find a playlist for others in this series down below this video. Please have a look at it. Start at the beginning because they are made in a particular order, and that is the best place to start in this case. We hope you enjoy them. Please let us have your comments. They will help us decide where we go next.

Poll

I began a discussion yesterday about what this year's Budget should consider.

I stressed that security issues would be key, but that national security can no longer be understood primarily in military terms. War, disrupted energy and food supplies, climate change, financial instability, cyberattacks, and AI all threaten the systems that everyday life depends on.

This post develops that idea, suggesting that the UK therefore needs a National Resilience Standard that requires essential systems to withstand prolonged disruption. This might include holding strategic stocks, maintaining spare capacity, building alternative supply chains, strengthening domestic capability, and planning effectively for contingencies, while ensuring that people's essential needs are met at all times. 

What conventional economics has dismissed as inefficient redundancy may now be essential insurance. Security means ensuring that food, energy, healthcare, communications, payments and government continue functioning when the world around us does not. This might need to be our Budget focus. 

The national security priority

I took my concern about the need for an alternative budget to the one that I think John Healey might present this year on a long walk yesterday, just to give me time to reflect on the critical issues that we now face.

I had found it relatively easy to write a note framing the budget as the one required to deliver national security for this country. However, once I did, it became much harder to work out what that might mean in practice, and what actions the government might need to take as a consequence.

I keep stating the threats as I see them, and they are not hard to perceive, but I will note them again, briefly, for the record. They are:

• Trump and Netanyahu’s war in the Gulf, for which there is no apparent end in sight.
• The war in Yemen, which is now threatening to block traffic through the Suez Canal, for which there is, again, little immediate prospect of there being an end in sight.
• The resulting near-total disruption to more than 20% of world oil and gas supplies, with massive implications for physical supplies of many commodities, impacting far beyond energy, which could cause major supply chain disruptions with consequent impacts on inflation.
• The potential for an AI-induced stock market crash amid all this, resulting in an immediate pension crisis, followed by banking, private equity, hedge fund, secondary banking, and then mainstream banking crises, as all of which might face liquidity or capital crises that threaten their viability.
• The risk that, in the middle of all of this, the threat from the use of AI to employment might continue to grow, because although AI companies might face financial crises with regard to their valuations, there is no reason to presume that they cannot continue to operate in their existing form given the scale of the funding currently available to them, which will be enough, in itself, to perpetuate this threat.
• Ongoing threats from climate change, rising temperatures, drought, El Niño, and the resulting threats to food supply, the physical and economic sustainability of many communities, and the sustainability of life itself here on Earth.

You could undoubtedly add a few more issues to the mix, such as a demand for more defence spending, but I suggest these are more than sufficient as a basis for concern, to which, at present, no apparent response is known to be available.

What does national security mean?

The question, then, is what national security means in the face of these threats.

The first, and most obvious, point is that national security cannot now be defined primarily in military terms. Of course military security matters, but most of the threats that I have listed cannot be addressed by military force. No amount of military spending can guarantee enough gas to heat UK homes if international supplies are disrupted, or that food will be available if harvests fail, shipping routes close, or supply chains break down. Nor can military spending keep the banking system functioning in the event of a financial crash, ensure that medicines remain available, keep the electricity system operating, or guarantee that the water industry has the chemicals it needs to make supplies safe.

In that case, we need a much broader understanding of what national security means. I suggest that national security means ensuring that the essential systems people in the UK need to live remain operational, whatever happens elsewhere in the world. Put another way, the question is no longer simply what threats we might have to fight. It is what we must be able to keep doing, whatever happens.

That change in emphasis is fundamental because it changes what we think national security policy is for. Energy has to come very high on the resulting list of priorities. We need to know electricity can keep being generated and distributed, homes can be heated, transport can keep operating, and essential industry can function even if international oil and gas supplies are seriously disrupted. That requires storage, spare capacity, diversity of supply, domestic generation, a resilient grid and plans for deciding which uses of energy should have priority if shortages occur.

Food is just as important. We need to know how much food the UK can produce, what we have to import, where those imports come from, and what happens if those supplies fail. We also need to know whether farming can continue if supplies of fertiliser, fuel, animal feed, machinery, spare parts or other essential inputs are disrupted. Climate change makes this question more urgent because it could disrupt several important food-producing regions or activities at the same time.

The same questions also apply to medicines and medical equipment. We need to know what is required to keep the NHS functioning, where those products are made, how much we hold in stock, how quickly shortages could arise and what alternatives would be available if normal supplies failed. The point is not that everything has to be made in the UK, because that would be impossible. The point is that we should know where the vulnerabilities are and have plans for dealing with them.

The same logic applies to everything else that is essential to the functioning of the country. Water treatment chemicals, transformers and other electricity network equipment, telecommunications equipment, computer chips, and critical minerals all have to be stockpiled in readiness for shortages, or duplicate supply lines have to be arranged, whilst transport infrastructure, ports, communications networks, data centres and cloud computing all have to be considered part of our national security infrastructure that must be defended, even if not from direct physical threat. So too do the cables and pipelines that connect us to the rest of the world, as do the payment systems that make it possible for people to buy food, businesses to pay wages and government to make payments.

Resilience requires redundancy

There is, however, another issue that follows from this. For decades, we have been told that efficiency requires businesses and governments to eliminate spare capacity. Stocks have been reduced, warehouses have disappeared, production has been concentrated, supply chains have grown longer, and just-in-time delivery has replaced holding reserve stock of essential supplies. Services have been outsourced, and manufacturing capacity has been moved overseas, all on the assumption that tomorrow will look sufficiently like today for these systems to continue to work. That assumption no longer looks safe.

In a world facing war, climate change, energy disruption, fragile supply chains, financial instability, cyberattack and rapid technological change, spare capacity is not necessarily waste. It can instead be essential insurance. Having several suppliers instead of one might appear inefficient to a business, until the sole supplier fails. Keeping stocks might appear inefficient until deliveries stop. Maintaining domestic manufacturing capacity might appear expensive until imports become unavailable, while spare electricity-generating capacity might appear unnecessary until another power source fails. Even properly funded local government, emergency services and public infrastructure might also appear costly until a crisis requires them.

Crucially, though, all of the assumptions I note are from a microeconomic perspective, and as is so often the case with macroeconomics, what makes sense at that level is the exact opposite of what does in microeconomics. It is an unfortunate fact that in a world where most macroeconomic thinking is built on the basis of microeconomic assumptions, this has not been appreciated, and if a single cause for the multitude of crises that we face were to be identified, this might be it. What we have called efficiency has, in other words, very often involved the elimination of the resilience that is an essential characteristic of a sustainable state, as well as good government and governance. If national security is our priority, that has to change. 

The National Resilience Margin

I think we therefore need what might be called, in the jargon that appeals to politicians, a national resilience margin. For every system essential to life in this country, we should ask a straightforward question: how long could it continue to function if its normal sources of supply were seriously disrupted?

We need to know whether we could keep the electricity system functioning for three months, maintain food distribution, supply hospitals with the medicines they require, keep water treatment working, maintain telecommunications, ensure that agriculture could continue operating and preserve the payment systems on which almost every transaction now depends.

The same question has to be asked about digital systems. Could government continue functioning if major commercial computer systems failed? Could essential services continue if international communications were disrupted? Could we maintain critical public services if access to particular foreign-owned cloud computing systems was lost? And could we withstand a major cyberattack designed not merely to steal information, but to disable the infrastructure on which everyday life depends?

I do not know the answers to those questions, and what worries me is that I am not sure that anyone in our government does either. Without that knowledge, I suspect our National Resilience Margin is way below what is required. 

That is why I think we then need what again be called, in a way that suits the political narrative, a National Resilience Standard, and that work on this should start now, even if we are already in the last hour before it is needed. Every system essential to national life should be required to demonstrate that it can withstand a defined period of serious disruption. If it cannot, government should require action.

That might involve maintaining strategic stocks, creating alternative sources of supply, preserving domestic production capacity, building redundancy into networks, ensuring that critical skills remain available within the UK, or creating public fallback systems where dependence upon private suppliers creates unacceptable risks. It would also require regular stress testing to ensure the plans work in practice rather than simply existing on paper. Critically, if this requires immediate rationing so that reserves can be built, so be it; that is the price we may have to pay for our past negligence and our tendency to push systems beyond their sustainable limits. 

Security requires preparation

This would require something else as well. We need to rediscover civil resilience. National security cannot simply be something delivered by the armed forces, intelligence services and central government. Local authorities, the NHS, police, fire services, utilities, transport operators, voluntary organisations, businesses and communities all have roles to play, and those roles need to be understood, planned and practised.

That means we should be running national exercises that test what happens if several things go wrong at once, because that is precisely the risk that we now face. An energy shortage might coincide with a cyberattack. Food supplies might be disrupted while financial markets are in crisis. Extreme weather might coincide with telecommunications failures. Any serious national security policy has to consider the possibility that these events will interact with each other, creating consequences that are much greater than those resulting from any one of them in isolation.

One further point needs to be noted. None of this means that the UK can, or should, seek complete self-sufficiency. We cannot produce everything that we need; nor would it make sense to try. National resilience must therefore also involve international cooperation. We need secure relationships with countries on which we can rely for energy, food, medicines, technology, critical minerals and industrial supplies. We need, in effect, alliances of supply as well as military alliances, because both will be essential to our security. In building these relationships, we must set aside old assumptions about who our partners might be. All that matters now is the ability to deliver.  The goal is not isolation. It is resilience.

The role of people

It would be easy to see the processes I have described as economic programmes to which other priorities should be sacrificed, but that would be a mistake. The whole purpose of national resilience is to support people in meeting their needs, and people must remain the priority of any such programme, or it will inevitably fail.

Resilience is meaningless unless it exists for everyone. In itself, it is therefore a programme about delivering greater equality. To ensure that this is the case, this priority must be continually highlighted as it was, for example, during World War II. Then policy was established not only to deliver military victory, but to ensure the greatest possible well-being of the people of the country whilst this goal was achieved, with the greatest sacrifice in pursuit of that objective being demanded from those with the greatest capacity to bear it. The same must be true this time.

A programme of resilience for a country that only protects some within it is not about resilience at all; it would reinforce inequality, and would necessarily fail as a consequence. Building resilience is a programme about the management of economic systems, including those that can deliver greater equality, and so well-being, across the country as a whole.

The essential foundations

These are the foundations for the Budget that we require at the time. They are radical, and essential if we are to survive all the risks that we face and thrive nonetheless. 

I have set out the requirements of a necessary national security policy for the UK at this moment. That said, I make clear that national security should ensure this country can continue to function when the world around it does not function normally. It should ensure that people can be fed, homes can be heated, electricity continues to flow, hospitals can operate, communications continue, payments can be made, and government can still govern, and all the while, people have the chance to thrive. It must also ensure that we have the capacity to recover when shocks occur, because resilience is not just about surviving a crisis; it is about having the capacity to rebuild afterwards.

If we can do those things, we will have substantially increased our national security. If we cannot, no amount of conventional defence spending can make us secure.

That is the basis on which I think a national security Budget has to be built, and that is the kind of Budget I think we need. 

What she is going to do next is what differentiates her experience in the current job market from that of many people who might be older than her. Instead of applying for jobs from the position of being employed where she is, she is proactively planning a period of time off work to seek alternative employment. She cannot otherwise work out how the time that is required simply to engage in the task of finding an alternative job would be available, so time-consuming is the process of submitting job applications these days, with the extensive questionnaires that have to be completed and then multiple AI tests that have to be gone through before the chance of even securing an interview with a real-life human being might be secured.

The young woman in question is fortunate. The impression I gained is that she has been able to save enough to take off this period of time between employments. She also has the economic advantage of living at home, and I suspect supportive parents will be assisting this process, at least indirectly.

My point, however, is that in itself this creates the potential for a new form of discrimination within the workplace of a sort that never used to exist. If, to secure new employment, you have to sacrifice income for a period of time, there are only a limited number of people in the fortunate position of being able to do that who can, as a consequence, advance through their careers in a world where it appears increasingly difficult to secure a job of any sort, let alone one that suits your needs and your long-term plans. I am obviously pleased that this person might have that support, and may, as a consequence, find the progression that she desires, and I hope she does. However, what worries me is the systemic implication of what her choices demand of her. In essence, she is being asked to consume her capital to secure the job she wants.

We are used now to young people only getting access to housing if they are supported by what is colloquially called the Bank of Mum and Dad. What her case revealed to me is that the significance of this intergenerational support from parents may be far more important than I had realised in a rapidly changing world.

We have all known that parents have influenced education outcomes, and that this has been true for many past decades. That is indisputable. That the same influence is now seen on the housing ladder is an established fact. But if it is becoming the case that the obstacles to securing work are now so severe that parental support, or significant personal capital that can be consumed in the process of job applications, is now the prerequisite for making progress in your personal development, we will see this discrimination resulting from relative (and I use the word advisedly) privilege become even more significant.

And let’s not ignore AI's role in all of this. Many people worry that AI will replace their jobs. Some, at least, have good reason to do so. But if the increasingly labour-intensive and capital-consuming processes AI has imposed on people seeking employment become real obstacles to progress for those trying to secure work that lets them fulfil their potential, then the threat from AI is indirectly much greater than I thought.

It now seems neoliberal capitalism is using its power to prevent progress for all but those with the financial capital required to achieve career progression, in ways nepotism and contact networks once did. Those forms of human capital were always obstructions to progress for some, but now it seems as though a person's ability to consume financial capital to appease the foibles of the neoliberal capitalist system is becoming another prerequisite for success in the quite reasonable desire for career progression.

This is toxic, deeply dangerous to human well-being, damaging to the economy, and costly to us all, as those with ability but without access to capital will inevitably be lost in this process. In other words, it is another deliberate form of inequality designed to reinforce divisions in our society.

We should be worried.

Our time is limited. So is our capacity to think, read, listen, understand other people and make sense of the world. That makes attention a scarce economic resource, and modern capitalism has become extraordinarily good at capturing it.

Advertising is the obvious example, but the problem goes much further. Corporations, social media, conventional media and political interests compete constantly for our attention. The result can be distraction from much bigger questions about inequality, climate change, public services, economic power and the way our societies are governed.

John and I discuss the ideas of Simone Weil, Iris Murdoch, John Kenneth Galbraith and Herbert Simon, alongside the warnings contained in Aldous Huxley’s Brave New World and George Orwell’s 1984.

We also ask what education and economics have to do with our declining capacity for critical thought, and whether distraction can undermine our agency as citizens.

Most importantly, we ask how we reclaim our attention.

Walking, reading, talking, observing and simply creating space to think might sound economically unimportant. We argue precisely the opposite.

If we surrender control of our attention, we risk surrendering our ability to think for ourselves.

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This is the transcript:

In this week’s podcast, I talked with my old friend and Tax Justice Network co-founder John Christensen about something that has increasingly concerned me: the economics of attention.

Attention is scarce. We only have so much time in our lives, and what we choose to notice, think about and understand matters enormously. But, as John and I discussed, modern capitalism has become extraordinarily effective at competing for that attention, and in doing so depriving us of the time and space required to think.

I came to this subject through conversations with my wife, Jacqueline, initially prompted by the philosophy of Simone Weil and then the work of novelist and philosopher Iris Murdoch. Both understood attention as something profoundly important. To pay proper attention to another person is to try to understand them and their place in the world. In that sense, attention is an act of generosity.

But attention also has an economic dimension. Herbert Simon recognised this more than half a century ago, while John Kenneth Galbraith had already identified something similar in The Affluent Society. Galbraith understood that affluent societies were no longer characterised by the scarcity that conventional economics presumed. What they lacked instead included adequate public investment and the ideas needed to make society better.

John and I explored what has happened since.

Advertising is an obvious part of the story. Modern capitalism continually demands our attention because it wants us to consume. The implicit message is no longer Descartes’ “I think, therefore I am”, but something much closer to “I consume, therefore I am.”

But advertising is only part of the problem. Corporate power also influences the media we consume, the political narratives presented to us, and the economic ideas treated as acceptable. John described corporations as masters of distraction. The purpose is not simply to sell us more things. Distraction can also stop us from paying attention to much bigger issues, including inequality, climate change, pollution, failing public services and the concentration of economic power.

We discussed Aldous Huxley’s Brave New World and George Orwell’s 1984. Both understood, in different ways, that controlling attention could become a means of controlling society. Huxley imagined people distracted and conditioned into accepting their allotted place. Orwell imagined surveillance, propaganda and endlessly rewritten narratives. Elements of both now seem disturbingly relevant.

Education should provide an antidote. Its purpose should include creating people capable of critical thought. Yet we questioned whether modern education is achieving that goal. Universities increasingly sell qualifications while students incur substantial debts, academics face enormous pressures, and the space for genuinely independent thought is constrained. Economics itself has become particularly problematic because much of the discipline has been reduced to mathematical models and familiar claims that bear too little relationship to the economy people actually experience.

The result is that ideas such as the household analogy for government finances, the supposed necessity of austerity, the claim that interest rates are the answer to inflation, and the insistence that tax cuts for the wealthy generate growth are repeated so often that they acquire the appearance of truth. Attention is captured by repetition.

John and I also discussed war as perhaps the ultimate form of distraction. Galbraith regarded war as one of humanity’s greatest failures. Orwell understood its usefulness to those seeking to control populations. War absorbs attention, demands loyalty and can crowd out discussion of almost everything else.

That brought us to the question that mattered most to me: how do we reclaim our attention?

For me, part of the answer is deliberately creating space in which to think. I walk. I watch birds. I talk to people. I sometimes turn off the screen and put down the phone. These activities might appear to be distractions from economics, but they are anything but that. Concentrating intensely on something completely different can provide the mental space in which other problems resolve themselves.

John described something similar. Serious thought requires time, conversation, reading and reflection. It also requires discipline about what we allow to claim our attention.

That matters because losing control of our attention means losing something more fundamental: our agency. If we cannot decide what deserves our attention, it becomes much harder to decide what we think. And if we cannot think independently, our ability to participate meaningfully in democracy is diminished.

Our conclusion was therefore that attention is not some peripheral economic curiosity. It is a scarce resource over which there is an intense struggle for control.

Capitalism wants our attention because it wants our money. Corporations want our attention because they want to influence our choices. Political interests want our attention because controlling what we notice can influence what we think matters. Against all of this, reclaiming attention becomes an important act of personal and political agency.

I returned at the end of the discussion to Iris Murdoch’s idea that attention is one of the most generous gifts we can offer. We need to pay attention to ourselves, to other people, to our communities, to our countries and to the world around us. Doing so means looking beyond the screens and narratives constantly presented to us and noticing what is actually happening.

And perhaps we also need what John and I jokingly called “weird societies”: places where people willing to think outside the accepted mainstream can meet, talk, listen and give each other the confidence to continue doing so.

As Hunter S. Thompson put it, when the going gets weird, the weird turn pro.

The going is certainly weird now.

Paying attention might be one of the most important things we can do.

According to the American Automobile Association, diesel hit its highest recorded average price today at just above $6.44 per gallon. Diesel moves most of the consumer goods in the United States. Iran’s news agency reported today that a political advisor to Iran’s Supreme Leader said Iran would not reopen the Strait of Hormuz until President Donald Trump and Israeli prime minister Benjamin Netanyahu are removed from power.

As the conflict drags on with no coherent U.S. strategy, J.P. Morgan wrote yesterday, “We simply don’t know how to model the endgame.”

She added:

Today Bloomberg reported that Saudi Arabia has told European refiners that they will not be receiving crude oil next month because of the shutdown of the East-West pipeline.

This is what failure looks like.

As Heather Cox Richardson also noted, Trump responded to the willingness of US media to discuss these issues, and their consequences, by announcing he is banning CNN, MS NOW, and Politico from the White House.

Trump’s claim is, of course, that the media is lying about what is happening and everything is going fabulously. This is straightforwardly contradicted by data, evidence on the ground in the USA, and polling information, which shows just how likely it is that he will lose the midterm elections. What will happen then is, however, still unknown. Speculation that there might be an outright refusal to register the result is widespread.

Let me, however, return to the economics of this. The USA is an economy that has been driven by road fuel for a century, and compared to the rest of the world, that fuel is cheap there, largely because taxes on it are low. Now, people there, as elsewhere, are facing prices they once considered unimaginable. The immediate consequences are financial stress, but what is just as important are the long-term consequences that will arise if, as Iran is threatening, there is no solution to the crisis in the Strait of Hormuz, and the new crisis created by Houthis in Yemen has, as many expect, a major impact on oil flows in and through Saudi Arabia.

Events are unfolding largely as I expected, but most of the world failed to hear the warnings a few of us promoted, that this crisis was coming and would be much larger than any of our politicians were willing to anticipate.

In the USA, the impact of this crisis will be seen in poll results in the midterm elections in November. Shortly before that, though, here in the UK, we will have a chance to see how our government is responding to this issue, because John Healey will, in his role as Chancellor of the Exchequer, present his Budget at the end of that month, and with it the associated forecast from the Office for Budget Responsibility.

Those forecasts must now be in preparation. The OBR should by now have formed its view on where the conflict in the Gulf is heading, when it will be resolved, and what the impact on oil and other prices will be, because those three variables will inevitably shape many aspects of the rest of its forecasts.

My suggestion is that the disruption will now last for years, that we have by no means seen the limit to oil price increases as yet, and that a major inflationary impact is inevitable as a consequence which, as I keep on saying, the Bank of England could make very much worse if it were to increase interest rates at the same time. I think it would be very hard, given current evidence, for the OBR to reach any other plausible conclusion.

That reduced oil consumption might be good for the world is a fact. That its arrival in a completely disorganised fashion, as appears likely as a consequence of Trump’s stupidity, is something altogether different, and could create economic chaos on a scale that we have not seen in anyone’s lifetime.

So how will the OBR manage this risk? Will it, as it did in the March 2020 Budget forecast on Covid, largely pretend this event is not happening? Of all the options available, that is, I think, the most likely, but if it is what happens, we can guarantee that John Healey will have to be back at the Despatch Box delivering an emergency Budget in early 2027 at the latest, and that will leave his position, and that of Andy Burnham, as irrecoverable because all the warning signs will have been present in October.

The alternative is that they acknowledge the risk and say what they will do about it. That seems much more likely than a ‘heads in the sand’ approach. Imagining change on the scale required might be beyond the OBR's capacity, because it, like the Treasury, assumes everything returns to what it considers 'normal' within two years at most in all its forecasts. Those forecasts are literally programmed to do that, but that is not going to happen this time, so what will?

I think I had better think through the answer to that question in greater detail than I have before. I am now persuaded that things are very much worse than I previously thought. The economy is going to get really bad, and we need a plan. Wish me luck. We are all going to need a lot of that.

Having worked a full day last Sunday, I felt like a day off, so we went to Hunstanton and went to the station there.

This is the boathouse, which was open to visitors. There is a B-class boat here.

In front is one of the volunteers, who happily showed us around. I enjoyed our conversation, and he consented to have his photo taken.

The building on the right houses the station's hovercraft for work out on The Wash. It is one of only four stations to have one in RNLI service.

And the building on the left in this shot, which Jacqueline took, is the Old Town Beach Cafe. Because I was wearing an RNLI shirt with a station name on it, they were sure I was crew or a volunteer - as they are reserved only for them at Hunstanton. I had to assure them I was not and did not deserve the free coffee they wanted to give me, because everyone from the RNLI gets one. What I admired was their generosity and the welcome this community gives to its station. In light of recent news, it was very heartening.

I should stress that this station is in Old Hunstanton, which is a mile or more from the main town with that name - and its beach is very much nicer - and a great place to walk, especially in winter.

We came home with our spirits lifted, diverting to RSPB Tithwell on the way back. So now I am working on Sunday. A book needs to be written.

The details of the spats in question do not greatly trouble me, although I have little doubt about who is telling the truth.

The real issue is that the possibility that the probity of someone in high office - who happens to be King - is being openly questioned.

On the same day that the possibility of MI5 being held to account for contempt of court was raised, the idea of accountability being on the agenda makes a very welcome change.

Now, when will ministers be held accountable for their support for genocide in Gaza?

In this episode of my series on Understanding Economics, I argue that work is the foundation of economic value. Without human effort, care and creativity, money would still exist, but there would be very little worthwhile to buy with it.

That raises some important questions about how modern economics values work. Much socially essential work, including caring for children and elderly relatives, volunteering and supporting communities, is unpaid and largely ignored by measures such as GDP. At the same time, many people in paid employment are prevented from making full use of their skills, judgement and creativity.

Since the 1980s, power has also shifted from workers towards employers and shareholders. Trade unions have been weakened, insecure employment has grown, and work has increasingly been treated simply as a cost of production rather than as the activity that makes production possible.

Artificial intelligence makes these questions more urgent. AI may eliminate some existing jobs, but there is still an enormous amount of socially useful work that needs doing.

If we want an economy that serves people, we need to rethink what work is, what creates value, and what our economy is actually for, which is why Understanding Economics, because in the series I  ask what economics looks like when people really matter. You can find links to other videos in the series here.

This is the audio version:

This infographic supports this video:

This is the transcript:

Hello, I’m Richard Murphy, and this is Understanding Economics. That’s the series of videos that I’m making, which explains the way in which I think our economy works. Now, I have to stress that this is how I think the economy works. It is not how most economists think the economy works, but their stories about the economy have led us to be in the mess we’re in, and I’m trying to build a narrative around the way that things actually work. And that is what I think is important, and that is what I think adds value by creating a series of videos that ask questions about the world in which you and I actually live.

And in this video, I want to talk about work and what it is, what it does, and how we should value it.

Just imagine that nobody worked tomorrow. No food would be grown. There would be no care services. Services in general would collapse. There would be nothing to buy. Money might still exist, but without human effort, there would be nothing worthwhile to exchange in any known marketplace. It is work and not money that creates wealth. That is my point in saying that. We have to understand that work is the foundation of our economy.

Early 19th-century economists, those who existed from Adam Smith to the time of Karl Marx, all understood this. They realised that what makes an economy work and what creates value is the people who undertake the activities that create things that we need. But as economies grew richer from about the 1870s onwards, the focus shifted from making things to buying and selling them. And that is true of the real economy, and that is true of economics. It changed its focus and purpose to justify this shift from production towards the basis of extracting money from business ownership, property ownership, and the management of these resources in a way that wasn’t about creating real wealth, but about creating financial wealth.

We began treating people who owned things as wealth creators, though as a result, and forgot the people who actually do the real work. That distinction became very real, and it continues to this day.

But why do we work? Well, obviously we work for an income. Most of us have no choice. That is the way we are going to get the resources that we need to survive. But that is never the whole story about work, or it isn’t for most people. Work gives shape and structure to our lives as well. It creates friendships and a sense of belonging. And above all, it lets us feel as though what we do matters to those in the world around us. And I see this everywhere in the interactions I’ve had throughout my career, and now with the people who I engage with in all the businesses that I have dealings with. Those interactions reveal that people get from work something very much more than their pay.

And there’s good news to that because a great deal of work is never paid. Think of parents raising children, people caring for elderly relatives, volunteers, and community helpers. All of this activity creates real value for real people, but most of it is unpaid, and most of it is invisible to official measures like GDP, the figure that governments use to say how much a country produces.

But not being paid does not mean something is not work. We all know that because we all know that there is work that we have to do, which will never be paid for, but which nonetheless does either provide value to us or to someone else, and as a result, improves the lot of human well-being, and that is what work is all about.

At the same time, there is a problem with much of paid work. When I go out and about, what I see is people doing remarkable things, very often in their spare time. They coach sports teams. They run community groups. They care for others, and they create things. Yet at work, these same people are often given little chance to use their judgement, creativity, or initiative. That is not just unfair. It is deeply wasteful.

An economy that fails to use what people can actually do will always underperform. And that is what the UK is doing. We have a problem with productivity in this country. It is because we do not let our people do what they’re best able to deliver. This is the economy we are living in.

And since the 1980s, work has been devalued, and that has been a deliberate policy choice. Power has shifted away from workers and towards employers and shareholders. Trade unions have been weakened; insecure and zero-hours work has grown; and if you are sick, injured, or made redundant, the cost falls increasingly on you and not on your employer. None of this was inevitable. It was a political choice, and it was a choice to undermine the value of work. And choices like that can be changed, which is an important point to note.

AI makes all of this even more urgent, though. Artificial intelligence will replace some of the work people do today. This is a process that has always happened. I can recall when there were things called typing pools. There is no such thing today. The word processor has eliminated the need for typists, and AI will eliminate the need for some jobs. But lost income is not the only problem that will arise as a result, because work also provides purpose, identity, and connection. And if that is lost because of the mass introduction of AI, as some fear, this will have a significant impact on the well-being of people in this country.

But I’ve got to stress at the same time that there are vast amounts of genuinely important work that is simply not being done in our country at present. There is too little care being provided. There’s too little education. There’s too little environmental repair, and there’s definitely a shortage of investment in our community life. Work exists, in other words. The opportunity to do it is what is missing. Politicians will not fund people to do the work that is required and are wringing their hands over the work that will disappear. There is no reason why we couldn’t see this as a moment of liberation. A chance to refocus work on what is needed rather than what has been done, but which is no longer required.

We need to rethink work in other words. We should value work by what it contributes to people, society, and the planet, and not just by whether it turns a profit. This means recognising unpaid work as real work and changing our measures of production to reflect that fact. It means creating jobs that use what people are genuinely capable of creating. We need, in other words, to use people’s talents. It’s a crime that they’re left to go to waste. And if that requires public investment in socially valuable activity, we should make it.

Almost everyone has something to contribute. Work is valuable. Work creates the value in our economy. Our economy should exist to make those things possible. And if it doesn’t, we’ve got our economy wrong. And that’s what the focus of Understanding Economics is all about.

Let’s be clear: work is the foundation of wealth. Human effort, care, and creativity produce what we need to live. An economy that values ownership more than contribution has all its priorities wrong. We need an economy where work defines value and where everyone has the chance to do work that really matters.

This is why I think it’s important to create a series like this on Understanding Economics as if people matter. If you agree, there is a playlist down below this video, which you could watch. There are quite a number of videos in this series now, but all of them are only about 10 minutes long, and you could watch them in order and begin to understand that a different form of economics - an economics that serves you and your interests is possible, and that is what Understanding Economics is all about.

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A lifeboat station on the south coast of England near the spot where far-right activists tried to stop asylum seekers landing has been forced to temporarily close, it has emerged.

The station in Portsmouth shut after it and other sites run by the RNLI were targeted by people objecting to the lifeboat charity going to the aid of people trying to get to the UK on small boats.

Jacqui Irons, the head of the south-east region of the RNL, said: “Portsmouth lifeboat station has been temporarily off-service since 7 September. We have a duty of care to our people. We therefore took the decision to pause activity at the station to review crew safety and wellbeing, and to support those involved in the incident on 6 September.”

I am deeply angered and saddened by this.

I should start with a declaration of interest. I have been a Governor of the RNLI for decades, which is not nearly as grand a title as it sounds. It just means I have made a financial commitment to it, so I am one of the organisation's voting members. Most of its members are not.

So, why make that commitment? First of all, both my grandfathers were in the professional Navy, and that, I think, through my father, left a lasting interest in all issues to do with the sea.

Then, as a consequence, I think I was taken to a lot of lifeboat stations as a child. That has left me with a long-term respect for what so many people have done for 200 years now by taking risks to save others who, to use the traditional form of words, are in peril at sea.

I do not think that anyone joins the RNLI as a crew member or station volunteer for a moment of glory. I strongly suspect that if they did, they would not last for long, because that is not how crews work.

The reality is that right around the country people volunteer their time, often with the active cooperation and consent of their employers, to crew lifeboats and provide the onshore support that is necessary for them to launch, for the reason that they care about the well-being of other people, whoever they might be, and wish to help them if they are at risk. That is a simply stated objective, but it takes courage, skill, and most of all commitment to deliver, because without regular practice, training, and support, the task would not be possible.

If my part is to chip in a bit of money, I hope it helps. I hope others might do the same. It is the least I can do when others do so much more.

In addition, as I learned to do from my father, I also visit stations whenever I can and offer my thanks. The most recent new station for me, at which I did that, was North Berwick in East Lothian, near Edinburgh, when I visited there in March. I added its station polo shirt to my collection during the visit, and I’ve been wearing it proudly ever since. I am pleased to show my association with the RNLI, which represents some modest but real commitment on my behalf.

I am now shocked, appalled, and upset that racist thugs in this country are targeting RNLI lifeboat stations, other installations, but most especially crew members and other volunteers because they put themselves at risk to save the lives of those refugees who are forced, as a result of hopelessly inappropriate UK government policy, to take to small boats to cross the English Channel to exercise their right, established in international law, with the support of this country, to claim asylum in their country of choice.

Saying that, I stress, the RNLI goes out to anyone at risk. It does not fill in a profiling questionnaire before the boat is launched. It rarely asks a question about the weather or the challenges that the crew will face. It simply does what is necessary to offer assistance when required, and save a life when necessary.

In doing so, it embodies the maxim that I still think is one of the best to adopt for a life well lived, which is love your neighbour as yourself. Indifference as to who the neighbour might be is a critical part of this instruction, as those on the laughably described Christian far right should note from the parable of the Good Samaritan, which I presume they have never read.

What we also learned this week was that the people of the village of Piddington in Oxfordshire, to whom the media has given a great deal of attention for their xenophobia, as described by a brave member of their own community in media interviews, hosted a visit from the leader of those who organised recent protests in Dover and Portsmouth, where men in black with balaclava helmets marched through streets and then, in the second case, threatened RNLI crews and those they had rescued from the sea.

Is this how far we have descended? Do the people of that village really think that their actions are appropriate? Do they really believe that their interests are aligned with vigilantes who threaten through the use of violence, who undermine the rule of law and who challenge the work of those who will care for others, whoever they might be?

To what depth of depravity, and I use the word advisedly, have we descended as a result? Have we really reached the point where, as happened in so many communities in fascist-ruled Nazi Europe, people willingly betray their neighbours because of their ethnicity, beliefs, or other characteristics, knowing how hideous their fate might be?

It would appear possible that we have. But do we hear the government describing the situation in this way? Unfortunately, not.

And why is it that the BBC put so much time and effort into promoting the idea of this village declaring itself independent from the UK to promote the cause of racism when it is apparently utterly indifferent to the genuine political independence cause supported by millions in Scotland, Wales and Northern Ireland?

Most of the rest of the media is, of course, more than happy to follow suit.

And what does this say? Are they now suggesting it is fair game to attack the RNLI and its crew members? Are they saying we should be indifferent to saving lives at sea if it so happens that those at risk are fleeing in fear as refugees and seek asylum in this country, as it turns out that most of those in the small boats in the English Channel really are?

But most of all, what does this say about the corruption of values in this country? After 45 years of neoliberalism, where, as a consequence, most people have apparently lost the idea that the neighbour is anyone we might meet, wherever they come from, whoever they might be, whatever their colour, whatever their race, whatever their ethnicity, whatever their gender, whatever their sexual orientation or whether we like them or not, it is now apparently possible to deny that, and that fact alone is truly frightening.  In contrast,  believe that anyone who wants to consider themselves an ethical member of a community that inevitably spreads around the whole world has a duty to love their neighbour as themselves, especially when they are in peril.

I am aware that the RNLI has advised people that they should not wear RNLI-labelled clothing at present if they feel at risk.

I will wear an RNLI polo shirt today.

I will do so with pride.

I will do so because I believe in this organisation to which I contribute, however modestly, and the work that it does.

I will do so as an act of defiance.

I will do so because I will stand up for what is right, just as the RNLI has, with its courage and commitment.

And I want to stress that those last two characteristics are now essential. If we are to love our neighbour as ourselves - and I think we should, whatever our beliefs, and even if we have none of a religious nature - courage and commitment are what we now need to face the challenges that the corrosive politics of neoliberalism and the far right have created in this country.

Usually, I would now be facing a day of writing, content creation, and more. I am not sure about that now. Maybe I need a long walk to reflect on this. Perhaps I should call in on a lifeboat station as well. Solidarity matters.

But would raising interest rates actually tackle the inflation we now face?

The problem is that much of this inflation is being driven by disrupted energy supplies, food pressures and geopolitical instability. These are supply-side problems. Higher interest rates cannot produce more oil, gas, electricity or food. They can only reduce demand by making households and businesses poorer.

In this video, I explain why I think the Bank of England is using the wrong economic tool for the problem we face. Higher rates increase mortgage costs, put pressure on rents, discourage investment and can increase unemployment. At the same time, they increase returns for many owners of financial wealth.

I argue that the appropriate response to supply-driven inflation is very different. We need investment in energy security and food resilience, targeted fiscal support for those hardest hit by rising prices, and lower interest rates to reduce unnecessary pressure on households and investment.

Monetary and fiscal policy should work together to maintain economic and social stability. Instead, we risk having one foot on the accelerator and another firmly on the brake.

This is the audio version:

There is no debate ammunition for this video, but this previously published infographic supports it:

This is the transcript:

The Bank of England made a serious mistake yesterday. It didn't raise interest rates, we have to give it credit for that. But at the same time it warned that it will have to do so following the example set by other central banks. They say they will have to do so to tackle rising inflation.

But let's be clear: it is disrupted energy supplies, food shortages, and drought that are driving this inflation. There is no excess demand problem to solve in our country at present, and it is only inflation caused by excess demand that an interest rate rise can ever address.

That is the serious mistake in understanding that the Bank of England revealed in its thinking yesterday. Most especially higher interest rates cannot create more energy or food, so they cannot solve any known economic problem.

And let's be clear: the inflation we are witnessing right now is supply-driven. It reflects shortages of essential real resources. Energy, food, and supply chain disruptions are its causes. Demand is not excessive. In fact, for millions of households in the UK, it is already inadequate. They do not have enough to spend because they are suffering a cost of living crisis. To pretend that they are driving up inflation as a result is quite absurd. As a consequence, this interest rate rise addresses none of the issues implicit in the situation that we are facing in our economy at this moment.

Let me use a metaphor to explain how wrong the Bank of England's actions are. Imagine the water supply to your house has a blockage or leak in it. Your house is receiving less water than it needs because the supply pipe is failing. Now, I stress you're not paying for that water, but you still have a problem. You haven't got enough water in your household. That's a supply-side problem.

The obvious solution is to repair the pipe. Instead, the water company increases the price of water to you to maintain its income and profits, even though you have less water than you need. You will pay more as a result. But the shortage remains. Nothing is fixed.

This is precisely what the Bank of England is doing. The economy has shortages of energy and food. The Bank has responded by increasing the price of money. Doing that does nothing to increase the supply of either energy or food. It just protects financial interests while making everyone else's problems worse, and the economy very much weaker. The Bank of England actually knows that, and the most staggering thing is that it is doing this anyway.

So, how should we describe this action on its part? We could call it economic illiteracy, except they know what they're doing. In that case, the only other description I could think of is class warfare, not a phrase I use very often, but which in this situation seems to be entirely appropriate.

Workers are being explicitly discouraged from seeking pay rises to protect their living standards because this policy will deliberately increase unemployment. And meanwhile, households will face increased living costs, and borrowers will face higher mortgage costs, and those in rental accommodation will see higher rents. And that will all be because of higher interest rates.

And at the same time, those already making excess profits from shortages, and we know that oil companies already are, will be left entirely untouched by this interest rate change. In fact, they may be better off because they, along with the wealthy, will be earning more interest as a result. The owners of financial wealth are then being protected, while working people will pay the price. That's why I think this is class warfare.

So what should have happened? The real causes of inflation should have been addressed . The supply disruptions driving this inflation are geopolitical in origin. No interest rate change created by the Bank of England can resolve a war in the Middle East. But government investment in alternative energy and food supplies could have been made now as a matter of urgency to solve those real underlying problems in our economy. The only problem is that those investments will now be more unaffordable because of increased interest costs.
What we need is more investment in our economy. And the Bank of England has just made that very much harder with a decision that looks even more incomprehensible as a consequence.

And what we also need is a joined-up economic policy. At present, we have the Bank of England running monetary policy and the Treasury running fiscal policy in this country. Monetary policy, with a threatened increase in interest rates, is trying to put a very hard brake on our economy at present. It is trying to create a recession, and more unemployment, and reduced demand. At the same time, the government has promised a better standard of living. It's trying to boost the economy. The consequence is that we're running economic policy with one foot on the brake and one on the accelerator, and we will be going round in circles as a consequence.

The government should end this farce. It should take control at this moment. The Bank of England's independence has to be suspended. We are facing a crisis. The government should say we are going to have to go through an economic transition where it looks likely that food and energy costs are going to rise, and it must reduce costs elsewhere as a result. What is the obvious cost it can reduce? That is the interest rate.

Doing that, it could solve the supply-driven inflation that we are facing. And history shows that these supply-driven inflation shocks do always pass over time, where time is usually a period of less than two years. And in that meantime, the government could announce that it will intervene, and provide price support, and tackle shortages and try to help those who are in real need as a consequence of that inflation . That is within its fiscal power, and it can afford to do it. Doing so will in fact be much cheaper than letting interest rates rise. So, reassurance and targeted action from the government are required, and not deliberately imposed economic pain.

So, that's what should have happened, and what would that look like if it had happened? Well, interest rates should have been cut. They are the wrong instrument for this problem. And cutting them would have, in fact, helped boost the economy at a time when it is going to be suffering stress already. That's the consequence of these prices working through the system. So cutting rates would've rebalanced people's ability to afford what is going on. Instead, everything is going to be made harder.

Fiscal policy should have been used to protect those who are hardest hit by rising prices.

And the government should have announced investment in domestic energy security and food resilience.

And why do this? That's because the central banks must serve economic and social stability , and not financial markets. Raising rates solves none of the causes of this inflation, and using them as a political choice is the wrong one.

That's what I think. What do you think? There's a poll down below. Let us have your opinions. Please like and share this video. Please do also subscribe to our channel and hit that bell, so you will be notified when we produce a new video. And if you'd like to donate to the channel, there is a link to do that down below, and we'll be very grateful.

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The terrible decision to come is that they gave the clearest possible hint that they will increase interest rates the next time they meet. As they put it:

Today, we’ve held Bank Rate at 3.75%. So far, higher global energy costs have had a limited effect on price and wage setting in the UK. But the longer this volatility persists, the bigger the impact it will have on inflation, and the more likely it is we will need to raise Bank Rate to ensure that inflation falls back to our 2% target.

On this occasion, three of the nine committee members wanted to increase rates now, but the remaining six prevented them from doing so, while making it clear that if inflation does increase in this country, they will have no hesitation in doing so. Since the current trajectory of fuel prices guarantees that this inflation increase will happen, it must consequently follow that there will be an inevitable interest rate rise in November. This will be disastrous for the UK and most households within it, but will maintain the well-being of the wealthy, banks, and larger companies without ever solving inflation or addressing any of the underlying economic problems within the UK economy. There will be a video to come on this issue tomorrow morning.

The Bank's terrible decision today is recorded in its minutes. They agreed, with regard to quantitative tightening, that:

The Chair invited the Committee to vote on the propositions that the Bank of England should reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, to zero. This should be conducted through a multi-year plan, such that the remaining stock of £368 billion of bonds held for monetary policy purposes is unwound at an annual average pace of £46 billion by the end of 2034, through annual sales of £20 billion alongside maturing gilts.

If pursued, this programme might reduce the current scale of bond sales by the Bank of England, which could, as a consequence, slightly ease upward pressure on interest rates, but by very little. That is because the guidance given is almost as important when it comes to long-term interest rates, which is what QE and QT are meant to influence, and the clear indication given is that the Bank wishes to dispose of all the bonds that it acquired after the 2008 financial crisis and the financial crisis of 2020, which arose as a consequence of Covid.

This decision makes no sense at all.

First, it gives the clearest possible indication that the Bank of England is intent on keeping interest rates in this country above the level they would naturally be for years to come. Those high interest rates have already penalised households, pushed unemployment higher than necessary, reduced economic activity, suppressed demand, and, as a consequence, helped fuel the rise of far-right politics in this country. If the Bank of England had set out to support the rise of fascism, it could not have delivered a stronger indication of its willingness to do so.

Secondly, what this process will do is remove reserves from the banking system. In other words, the value of the central bank reserve accounts held by our commercial banks with the Bank of England to ensure that the banking system is liquid, can survive shocks, and can provide the interbank stability that is fundamental to the operation of the UK financial services system will be reduced as a consequence, to the point where bank stability will be compromised.

In addition, the pressure upon banks to retain reserves to replace central bank-provided liquidity will be high, and the result will be that they will provide even less credit to UK business than they do already, with a consequent reduction in the level of investment in this country, which we already know is far too low for comfort.

Again, if the Bank of England wanted to send out a signal that, in this case, they are trying to create a banking crisis in this country, their message could not have been clearer.

I can offer no rational explanation for what the Bank of England has done today because, try as I might, I do not think that any is available. I do, therefore, have to look for irrational explanations.

The first is that the Bank of England has no comprehension at all of inflation, or the impact of monetary policy on it.

The second is that the Bank just does not care. They think there is a required response to inflation, which is an increase in interest rates, and so they will do it, come what may. This, then, is not management; it is the abandonment of a responsibility.

The third is that the Bank of England has adopted Schumpeter’s view that what the economy needs is an economic shock and that, without the so-called 'creative destruction' that he described, the current economic malaise in this country cannot be resolved, and it is intent on supplying that from beyond the boundaries of democratic control.

Which of these is the most likely option? I see no reason to choose. I think all three might be true, but the last most of all. Nothing can easily explain what they are doing.

The Richard J Murphy YouTube Channel

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My View on … Business

Richard J Murphy

September 2026

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This post is part of an ongoing series in which I set out my views on significant issues in economics, political economy, politics, taxation, and accounting. It should be read in that context. It provides an overview of a position that I have developed over many years of writing and analysis, rather than a comprehensive treatment of the subject. If you would like to explore these ideas in more detail, the reading list at the end of this post provides a good place to start. The whole View On series is available here.

This article was written to underpin a video in the Understanding Economics series that will probably be published next Monday. 

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When people talk about business, they rarely stop to consider what they actually mean. The word carries a great deal of weight in political discourse; it is invoked by politicians of all parties as though its meaning were self-evident, and its interests were obviously desirable. Business, we are told, creates jobs, generates wealth, drives innovation, and, in some versions of this story, is the principal source of everything good in modern life. Yet the word is doing enormous and largely unexamined work in these sentences. It is being conflated, often in the same breath, with the company, the firm, the market, and capitalism itself. These are not the same things. The failure to distinguish between them produces some of the most persistent muddles in economic thinking and economic policy, and I want to try to disentangle them here. I will begin with what business is not, move through the social and economic reality of what I believe it actually is, and address the objections that sceptical readers will want to raise before arriving at what I take to be the proper conclusions.

What the company is, and what it is not

The company is a legal form. In the United Kingdom, it is a creature of statute, brought into existence under the Companies Acts and given certain defining characteristics by law. It has a separate legal personality, distinct from its shareholders and directors; perpetual existence in principle; and limited liability for shareholders, who might lose what they invest into the share capital of the company if it fails, fails but nothing beyond that. These are genuinely significant legal innovations, most of which originated in the UK in the nineteenth century, and the limited liability company has played an important role in enabling large-scale economic organisation. But none of this tells us what the company is for.

The etymology of the word is revealing. "Company" derives from the Latin "companio," meaning literally a bread-fellow, a messmate, or quite literally, someone with whom you break bread. The original sense was of people working together toward a common purpose, sharing in the fruits of their common effort.

Modern company law has drifted remarkably far from that starting point. The current dominant doctrine, which holds that the duty of directors is primarily to shareholders and that the purpose of the company is to maximise returns to capital, represents a very recent and, I would argue, thoroughly misconceived departure from the original idea.

This doctrine also lacks solid legal foundation in British law and is instead best represented as economic mythology. The Companies Act 2006 does not require directors to maximise profits, nor does it impose a duty on them to minimise a company’s tax liability. Section 172 requires directors to act in the way they consider, in good faith, most likely to promote the success of the company for the benefit of its members as a whole, taking into account amongst other things the interests of employees, the impact of the company's operations on the community, and the desirability of maintaining a reputation for high standards of business conduct. That is a stakeholder obligation, not a shareholder one. The shareholder-primacy doctrine is a piece of ideological confection, not a legal requirement.

The company is also, in modern capitalism, surprisingly transient. Whitbread began life as a brewery and then became both a coffee shop and then a hotel chain, and continues to reinvent itself as its financial managers pursue returns in whatever direction currently seems most promising. Many of our largest corporations are in similar states of constant strategic restlessness, acquiring and divesting businesses in response to market fashion, financial incentive, and the preferences of institutional investors.

This tells us something important. The company, as a legal and financial vehicle, is often indifferent to the activity it contains. The business inside the corporate shell may change entirely while the legal entity continues unchanged. The shell and the substance are separable things, and it is the substance that we are actually talking about when we talk about business.

What the firm is, and what it is not

The "firm" is an economic concept rather than a legal one. In standard microeconomic theory, the firm is the unit of production. It takes inputs, transforms them through some production process, and produces outputs that it sells. The theory of the firm is built around the idea that firms exist to reduce transaction costs, that they maximise profits by equating marginal cost with marginal revenue, and that the model of market equilibrium is built up from this foundation.

This model might be used by some economists for analytical purposes, but it is a deeply misleading description of what actually happens in business. The firm in neoclassical theory has no internal life. It is a production function, not an organisation. Workers are inputs, not human beings with purposes and interests of their own. The manager of the firm is not a real person making decisions in conditions of genuine uncertainty; the manager is a utility-maximising agent embedded in a model that has already assumed away everything interesting about what organisations actually do. This theory is, then, just that: it is a theory, bit it is not a portrayal of reality.

More fundamentally, macroeconomics cannot be built reliably from microeconomic foundations of this kind. The behaviour of the economy as a whole is not simply the aggregate of individual firm decisions, and more than it is the aggregate of all people’ decisions because the conditions that shape those decisions, including the availability of capital and money, the level of demand, the institutional framework, and the distribution of income, are themselves the products of macroeconomic processes. The firm, as economists have constructed it, is a model designed to make a particular kind of mathematics tractable. It tells us little about what business is or what it is for.

What markets are, and what they are not

It is also important to note that markets are not business. They are the institutional arenas within which business takes place, and the distinction matters. A market is created by a set of rules, backed by law and enforced by the state, that results in an space within which buyers and sellers can exchange goods, services, and assets. Without those rules, there is no market; there is merely power, and in conditions of raw power the strong take what they want from the weak without needing to offer anything in return.

In that case there are no free markets in the meaningful sense of the term. All markets depend on the state for their existence. They require property rights, which are legal constructs. They require contract law, which is state-provided. They require a currency, which is created by the state or under state supervision. They require regulation to prevent monopoly, fraud, and coercion. They require a judicial system to enforce their rules. The idea that markets arise spontaneously from human nature, and that the state is an obstacle to their proper functioning, is one of the most persistent and damaging myths in modern economics. The reality is that deregulation does not liberate markets; it tends to corrupt them by removing the protections that prevent powerful actors from extracting value from weaker ones.

Business operates within markets. It uses markets as the mechanism through which it reaches customers and suppliers. But business is not the market, any more than a football team is the pitch it plays on. The market provides the arena and sets some of the rules. What happens within it, and why, is a different question entirely, and conflating the two has caused serious damage to both economic theory and economic policy.

What capitalism is, and what it is not

Capitalism is a politically created system of ownership and accumulation. In its original sense, it refers to the organisation of production around the ownership of capital, which in this context usually refers to either financial or physical resources, with the returns to capital accruing to those who own it rather than those who work with it.

There is a version of capitalism, rooted in genuine risk-taking and the creation of new value, to which I have no principled objection. A fishing boat owner who saves, buys a boat, takes the risk of putting to sea, and earns a living from the catch is engaged in a form of capitalism that serves both the owner and society. The risk is real; the return is earned; the activity creates something.

But modern capitalism, particularly in its financialised form, has moved a considerable distance from that model. The dominant tendency in large corporate capitalism is not value creation but value extraction: that is, the accumulation of returns not through genuine innovation and risk-taking but through the exploitation of market position, the acquisition of monopoly rights, the extraction of rents from assets that the owner did not create, and the manipulation of legal and regulatory frameworks to suppress competition and socialise costs while privatising gains. The rent-seeking multinational corporation, which routes its profits through tax havens, exploits its workers through subcontracting and casualised labour, and captures the regulatory agencies that are supposed to constrain it, is not an aberration from capitalism in its current form; it has become its characteristic expression.

Mariana Mazzucato has done important work in demonstrating that the state has been deeply involved in underwriting innovation and creating the conditions within which private enterprise operates, and that much of what passes for private entrepreneurship depends heavily on public investment and public risk-taking. As such she has exposed much of the mythology behind the supposed benefits of modern capitalism. But even that critique may not go far enough. If the capitalist system consistently produces inequality, instability, and environmental destruction, then more active state involvement in directing it may only postpone the reckoning for capitalism as we now know it, rather than resolve it.

Capitalism as currently practised, and business as I understand it, are not the same thing, and the policies that serve the interests of financialised capitalism are often actively harmful to the kind of business activity that genuinely creates value and serves social needs. Rather than acting in unison, the interests of productive business and financialised capitalism are often opposed to each other, as I often witnessed during my career as a chartered accountant.

What business actually is

If business is not the company, not the firm, not the market, and not capitalism, what is it? My answer is that business is organised human activity directed toward the meeting of needs, the creation of value, and the sustaining of livelihoods, embedded within a social and institutional context on which it depends.

The key word in that definition is "human." Business is, before everything else, an expression of human purpose. When someone starts a business of the sort just defined, they are almost never, in my experience primarily motivated by the desire to maximise profit. They are motivated by the desire to do something: to make a product they believe in, to provide a service they think people need, to practise a skill they have developed, to express something creative, to build something lasting. The profit they need to generate is not the purpose of the enterprise; it is the condition of its survival. If the business does not make enough money to pay its costs and sustain itself, it will fail, and the purpose for which it was created will not be achieved. But the existence of that requirement does not mean that profit is what the business is for.

This is not a trivial distinction. It has profound implications for how we think about accountability, governance, and the proper objectives of business. If a business exists to serve a purpose, then its obligations extend to the people and communities that share in that purpose: its workers, its customers, its suppliers, its neighbours, the public authorities that provide the infrastructure it depends on, and the natural environment whose resources it uses. Company law already recognises something like this, as I noted above. What has corrupted it is the shareholder-primacy ideology, which insists that all other considerations must be subordinated to the financial interests of those who own shares.

The etymology of "company" is again useful here. The community of shared purpose, the organisation as a social unit built on mutual obligation and common effort, is not a romantic fantasy; it is a more accurate description of what makes businesses work than the thin abstraction of the profit-maximising firm. Businesses run by people who care about what they do, who treat their workers with respect, who take seriously their obligations to their communities, tend to be more productive, more innovative, and more resilient than businesses run by people whose only question is how to extract more from every relationship.

There is one more dimension to this that accounting has systematically obscured. Labour is not a cost. Or rather, treating it as a cost is a choice, an ideological decision embedded in accounting conventions, not an economic necessity. Labour is the source of value in an enterprise. The output of a business comes from the application of human skill and effort to raw materials and capital. The current framework charges labour as an expense and treats the residual, after paying all other costs, as the return to capital. But there is nothing economically inevitable about that ordering. One could equally start from the premise that the human effort in the enterprise should receive the residual, with capital costs treated as prior charges. That would produce a very different set of implications for how businesses are owned, governed, and remunerated, and it would reflect the economic reality of where value actually originates.

Small business and large business

One of the most important distinctions in economics is also one of the most routinely ignored: the distinction between small and large businesses. These are not the same kind of thing operating at different scales; they are qualitatively different entities.

The small business is typically an expression of purpose. The person who sets it up is usually doing something they have chosen to do, something they are good at, and something they believe is worth doing. They take personal risk. They are accountable directly to the people they serve. They are embedded in communities, both geographic and professional. They do not have the resources to manipulate regulatory frameworks or to externalise their costs onto workers and taxpayers. When they succeed, they do so by creating genuine value. When they fail, they bear the consequences personally.

The large corporation has often become something categorically different. It creates markets for things people did not previously want or need, using advertising and financial engineering to generate demand that serves the corporation's growth ambitions rather than genuine consumer needs. It entraps consumers in debt. It externalises costs through subcontracting and labour market casualisation, converting workers who were once employees into bogus self-employed contractors who bear the risk without commensurate reward. It lobbies to weaken the regulatory frameworks that would constrain its most harmful activities. It channels profits through tax havens, denying public revenues to the society whose infrastructure it depends on. These are not the behaviours of an organisation primarily concerned with meeting needs and creating value; they are the behaviours of an organisation primarily concerned with accumulating financial returns to the owners of its share capital.

This does not mean that all large organisations are malign. Cooperatives, mutuals, and public bodies operating in the public interest are forms of large-scale organisation that function on quite different principles. What they have in common is a commitment to a purpose that extends beyond financial extraction, and governance structures that enforce accountability to a wider range of stakeholders. The problem is not scale alone but ownership, purpose, and governance.

The City of London has, for decades, been structurally oriented toward serving the interests of large financial capital rather than funding genuine business activity. Small businesses in particular have been consistently failed by the UK financial system, which finds relationship-based lending to genuine enterprises far less attractive than the fees and arbitrage opportunities of investment banking. The consequences of this have been felt across communities outside the major financial centres, where genuine business has been starved of the capital it needs while financial extraction has flourished.

Common objections, and why I think they miss the point

The position I have argued in this piece will attract at least three serious objections from well-informed and sceptical readers, and I want to address each of them directly.

The first objection is that profit is, inescapably, what drives business. Without the prospect of financial return, the argument runs, no one would take the risk of setting up an enterprise. The market would not receive the goods and services that people want. Investment would not flow to where it is most productively deployed. The profit motive is not a flaw in the system but the mechanism through which the system allocates resources efficiently and rewards the people who serve consumers well.

I accept the premise that profit is necessary for business survival and that, in a market economy, the prospect of reward is a legitimate incentive. What I reject is the stronger claim that profit maximisation is the proper objective of business, or that it adequately describes what motivates the people who actually build enterprises. The evidence is not ambiguous. Most people who create businesses do so because they want to do something, and the need to make enough money to continue doing it is a constraint rather than the end in view. Beyond the level required for survival and development, additional profit is often a by-product rather than a goal. The companies that have done most damage to workers, consumers, and the environment in recent decades have typically been those most singularly focused on financial extraction. That is not a coincidence.

The second objection is that the company form is essential for organising the large-scale activity that modern society requires, and that any critique of shareholder primacy risks undermining the legal and institutional framework within which that activity takes place. Without clear rights for capital owners, the argument runs, investment would dry up, and the large organisations that we depend on would cease to function.

This objection confuses the company as a legal mechanism with the ideological content that has been poured into it over the past half-century. There is nothing in company law that requires shareholders to have primacy over all other stakeholders. There is nothing that prevents governance arrangements that give workers, communities, and public authorities a formal voice in how large organisations might be run. The argument that capital will simply leave if its supremacy is challenged is, in many cases, itself a form of rent-seeking: an attempt to defend extracted privilege by threatening the withdrawal of something that society cannot afford to lose. Good corporate governance requires accountability to all those who depend on and contribute to an organisation's success, not only those who hold financial claims on its surplus.

The third objection is that the distinctions I have drawn between business on one hand and capitalism, the firm, and the market on the other are essentially academic ones that make no practical difference to how the economy should be governed. If business as I have described it is what mostly happens anyway, then the analytical distinctions are a distraction from the practical questions of tax, regulation, labour law, and competition policy.

My response is that the conceptual confusion has very real practical consequences. When "business" is treated as synonymous with what large corporations want, the policy agenda becomes one of cutting taxes, weakening labour protections, reducing regulation, and clearing away the public institutions that impose costs on capital. When business is understood as I have argued it should be, the policy agenda looks quite different. It involves supporting the institutions, including public finance, skilled labour, strong regulatory frameworks, and accessible markets, that allow genuine business to flourish. It involves distinguishing between businesses that create value and those that extract it and using tax and regulatory policy to reward the former and constrain the latter. It involves recognising that the small business and the financialised multinational have different interests, different social functions, and deserve different treatment from the state.

Conclusions

Business is not the company, though it might operates within companies. It is not the firm, though economists model it as one. It is not the market, though it takes place within markets. It is not capitalism, though it operates under capitalist conditions. It is something simpler and more human than any of these things.

At its best, business is organised human purposefulness: the expression of skill, care, commitment, and purpose through economic activity that serves genuine needs, creates real value, employs people under conditions of dignity and fairness, and sustains the communities on which all economic activity ultimately depends. The profit it generates is the evidence that it is doing these things well enough to survive and continue. It is a means, not an end.

The great distortion of the past half-century has been the subordination of this kind of business to the demands of financialised capitalism, in which the purpose of enterprise is not to meet needs but to generate returns to capital owners, and in which every other obligation, to workers, to communities, to the natural environment, to the public purse, is treated as a cost to be minimised rather than a relationship to be honoured. This distortion has not served most businesses well. It has served very well the interests of those who own large quantities of financial capital, which is not at all the same thing.

What I want to see is a recovery of the original understanding of business as purposeful human association directed toward serving genuine needs within a social context that sustains it. That means better company law, enforcing the stakeholder obligations that are already present in principle but routinely ignored in practice. It means tax policy that distinguishes between genuine entrepreneurship and rent-seeking. It means governance structures, including meaningful worker representation, that bring the voices of those whose labour makes organisations function into the decision-making of large enterprises. It means public investment in the infrastructure, the skills, and the institutional frameworks that genuine business depends on.

Business, properly understood, is one of the things that human beings do that is genuinely worth doing. We should talk about it accurately, which means distinguishing it clearly from the company, the firm, the market, and the particular form of capitalism that has come to dominate our economic arrangements. When we do that, the policy agenda becomes clearer, the priorities become more defensible, and the case for a different kind of economy becomes both more rigorous and more compelling.

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