On the market

Paul Mason’s probing of big business, economists and politicians who appear on Newsnight turns the driest subject into compelling viewing. With an agenda he sums up as “profit, people and planet”, Leigh-born Mason clearly revels in his role as Newsnight’s economics editor.

I’ve never bought the mainstream explanation that markets are always efficient

Equally at home discussing credit default swaps with bankers and dubstep with protesting students, Mason’s scope is wide. And he also comes at his subject from a different perspective than many economics correspondents.

“I am no anti-capitalist but I’ve never bought the mainstream economics explanation that markets are always efficient and that complexity brings safety,” he says.

The financial crash surely bears him out. He started writing his gripping account of it, Meltdown, on the night Lehman Brothers went bust in September 2008 and it was published only five months later. Despite the banks’ role in the crash, how come they’ve been able to return to business as usual, including pay and bonuses?

“The bankers have created a system in which the politicians are an extension of an elite based in the banking sector,” he replies. “It’s a world in which there is a shared value system and the biggest shock they had in the last two or three years is that their value system suddenly came tumbling down.”

Nevertheless he does expect to see action. “Even the Bank of England is thinking about how to downsize the major banks. It may be more than just ensuring they have larger deposits when they lend, and it might even involve the legal break-up of banks in which the investment sector is split from the retail side.”

Mason agrees that public spending has to be cut

He believes that Vince Cable, the Lib Dem business secretary in the coalition government, won’t hang around if radical reform doesn’t happen and that if he goes it could easily precipitate the end of the pact between his party and the Conservatives. A few months ago he predicted that it wouldn’t last anyway but since then has rowed back because he feels the two parties are largely “in tune with each other over the cuts packages they are putting through”.

Mason agrees with the government that public spending has to be cut – although he is reluctant to be drawn on how quickly – but disagrees with its assertion that the poorest won’t be hit hardest. He’s not managed to visit his hometown of Leigh since 2009, when he interviewed pubgoers about David Cameron and found that few knew who he was. “They know now!” But he doesn’t believe the cuts will necessarily worsen the north-south divide – more that poor places right across Britain will suffer.

“Unless they have a way of switching over to the potential new sources of growth they will get poorer. There are opportunities to rebalance the UK economy, which I believe all the parties largely accept. It will involve promoting manufacturing, slimming down finance and creating productive as well as service jobs.

“The problem is that some areas lack a skilled workforce, making them unattractive to new industries, and these will be the blighted areas of the next 10 years. Not a pleasant thought but probably true.”

Mason may no longer be a Trotskyist but he still has a more intuitive understanding of the barricades of protest than other mainstream journalists, who were content to either patronise or demonise students who took to the streets recently over cuts.

“I observed a serious breakdown of public order, which the police struggled to control in part because you had 16 to 18-year-old working class youths who are not culturally averse to violence, alongside the more predictable university students who have a lot more to lose.

“I also think the older generation – politicians, police, journalists, even the student leaders – underestimated the sense of betrayal that has gripped, rightly or wrongly, part of that generation, who it must be said are the real losers in all this as they will be paying for the crisis for the next 30 years.”

Mason is close to completing ten years with the BBC and is also the author of Live Working, Die Fighting – How The Working Class Went Global, which links the labour struggles of old with the modern-day struggles of workers and peasants around the world and which was longlisted for the Guardian First Book award.

In it he expresses his admiration for workers at the Zanon ceramics factory in Neuquen, Argentina, who resisted management’s attempts to close it by taking over the ovens to continue production. Zanon is still open and has taken on more employees from amongst the thousands of locally unemployed.

By contrast, the income levels of manual workers in the US haven’t risen in real terms since 1973. Mason is convinced that unless the trend is reversed then an economy based on consumption will continue to decline – especially as no one is going to be able to boost it by selling sub-prime mortgages to those who couldn’t afford them or to those who, as Mason shows in Meltdown, were defrauded into obtaining one when they had the finance for a regular mortgage.

After the crash, then, what does a better form of capitalism look like?

In Meltdown, Mason admits trying to revive as a “policy option” the ideas of the late American economist Hyman Minsky. An expert on the great depression of the 1930s, Minsky was, says Mason someone who “worried about the potential for capitalism to create an unstoppable Frankenstein monster that would bring the whole system down. What he wanted was a socialised banking system, a highly dynamic private sector and no welfare state, but for the state to be the employer of last resort. It’s about creating boring banks, interesting businesses and giving people incentives to work – a sort of entrepreneurial social capitalism.”

Mason himself took to the picket lines last year

Mason himself took to the picket lines last year as the National Union of Journalists representative on Newsnight, protesting against the BBC’s plans to cut pension rights. “Even if like me you are at the top of the labour aristocrat tree it was necessary to openly participate because some of the people I work with aren’t that well paid. If you are asked to give away your basic pension rights then you fight as hard as you can to keep them.”

Despite his concerns though Mason has thoroughly enjoyed the decade, saying with a big smile: “Newsnight is one of the few places where we still do things essential to proper journalism, where a reporter can set their own agenda – so you are not in a factory-style process.

“You can get somewhere, rip up the schedule, switch your mobile off and pursue the story – and the bosses generally go with what comes out. Few people, even in print, still get to do that. It’s an immense privilege and I still pinch myself that I have blagged my way into it.”