It is time to confront crony capitalism
From Brother Ivo:
The growth of massive 'logistics' firms like Capita, Serco and G4S has occurred under both Labour and Conservative/Liberal Democrat administrations. They are employed in a variety of circumstances across a wide range of Government departments from Education, Justice, Defence and Immigration to Transport, Health and Leisure.
They are specialists in outsourcing and, as such, have built massive contacts with central government in this country and abroad. Serco, for example, is contracted inter alia to assist the implementation of Obamacare in the USA; G4S is the world's third largest private employer; and Capita 's turnover for 2012 was £3,352,000,000.
These are big companies by any standard and measure, which makes it all the more difficult for any government when their honesty and integrity comes legitimately into question. They have become unassailable in the public space, and so fall foul of Brother Ivo's dictum - 'When people/companies become indispensable, you have to let them go.'
When the story came to light of a possible £50million fraud of the taxpayer by two such service providers, it shook Government ministers to the core. They quickly declared that they would sign no new contracts with such businesses, and bought time with the excuse that they were systemically incapable of monitoring such complex systems to offer further guarantees of probity. They said they had been roped into the scandal of the preceding government by making clear that these problems may have actually begun more than eight years ago.
Instead of looking solely at the companies (though this must be comprehensively investigated), do we not need to ask about the complexity of organisation, remit and control that fosters problems of this kind?
At root, we have government that has expanded its role and ambition to such an intrusive extent that it needs the support of economic leviathans that have become 'too big to fail'. Even if they wanted to punish these companies by withdrawing contracts, they could not logistically do it. Not only are there no other companies to step into the void, but our government is so enmeshed that they could not extricate themselves from the outsourced 'tar baby' even if they want to.
It would be a brave backbencher who asked the parliamentary question: 'How long would it take to re-allocate contracts from these three companies, and what would it cost?' The answer would be shocking.
It was bad enough when we realised that we could not allow certain banks to fail, but MPs from all parties were able then to puff themselves up with outrage as nobody could easily associate them with complicity. But this scandal is worse. Our entire political class has allowed the outsourcing/data/logistics industry to become the elephant in the room. We cannot discuss it because the consequences of their disgrace or failure would paralyse government of any discription.
This is what crony capitalism looks like.
Government needs the out-sourcers; the out-sourcers need government. They have close, necessary and easy access to each other. There are consultants and consultancies to complicate the story.
We have come a long way from the days of EF Shumacher and his 'small is beautiful' philosophy - a way of thinking that influenced those on the Left and Right alike, and, indeed, the then emergent Green Party before they, too, fell in love with big government.
Schumacher drew his inspiration from an earlier thinker whose approach was slightly more nuanced. The right approach, thought Leopold Kohr, was appropriate scale: 'Whenever something is wrong something is too big.'
Brother Ivo does not know if Douglas Carswell has read Kohr or Schumacher, but his thinking on I-Democracy is plainly along the same line of thought.
The G4S and Serco £50million fraud inquiry highlights a scandal - even if they are found not to have swindled the taxpayer. But if they did, they may have inadvertently done us all a favour by making us all think seriously about the dismantling of a mechanism in which a handful of companies are too close to the political class, which is already increasingly seen as remote from those whom they represent.
Un-evictable bedfellows make Brother Ivo very suspicious.