Politically and electorally, the Labour left’s period of control of the party ended in disaster. Today, there are almost no signs to remind us that they were ever there.
In the policy world though - the world of ideas – Corbynism’s legacy is far stronger. In climate policy, proposals like the Green New Deal continue to loom large. Abolishing tuition fees, intervening in the energy market, building more social housing – many of the ideas developed by the left in the period 2015-19 stand up to scrutiny and remain firmly on the table.
Community wealth building (CWB) is another totem of this period of policy development. ‘The Preston Model’, as it was often referred in the press prior to the 2019 General Election, was sold as representing a microcosm of what Coybynomics might look like in practice – a taste of how 21st century democratic socialists might seek to reshape the economy. Today, CWB and its application in local government is frequently suggested as a direction in which the now-far-less-powerful left should direct its energies.
But what is community wealth building? And is it really as radical as both its proponents and detractors seem to suggest?
Factory-Made American Socialism?
Most of the intellectual work that went into creating community wealth building as a policy agenda happened in America. Before the Preston Model, we had the Cleveland Model. Following principles developed by Ted Howard and the Democracy Collaborative, there they proposed an agenda of local economic transformation built around localising investment from public sector institutions, cultivating local cooperatives, rewarding high quality employers and looking for local economic ‘multipliers’.
A number of think-tanks were then involved in efforts to repurpose these ideas for the British context, including the Centre for Local Economic Strategies (CLES). Theory met practice in Preston, where under the local leadership of Matthew Brown, anchor institutions from the council to the local university have worked together to keep wealth inside the city by localizing procurement and supporting local worker-owned businesses.
Evaluations suggest that this approach has had a lot of success. The numbers are big. Since 2013, “£70 million has been redirected back into the Preston economy; £200 million invested into the Lancashire economy; spending behaviour within public bodies has been transformed; and, new tools for a fairer economy have been developed”.
Obviously, this is excellent news. The purpose of this blog isn’t so much to question the efficacy of community wealth building, or the outcomes it can generate. What I would like to question though is the extent to which any of this can be considered radical. How is it that after 5 years to think about it, the big breakthrough in leftist economic thinking that Corbynism was able to deliver… was a new approach to public sector procurement? Is this really what we’re going to build around?
Where’s the community in community wealth building?
One of the big claims of CWB is that it offers a way of democratising the economy. But how does it actually deliver this? CLES explain it as follows – CWB leads to a more democratic economy because ‘anchor institutions have a greater affinity to the local economy and its residents’.
There are a few problems with this statement. Firstly, and a little superficially, greater than what?
More substantively, it’s worth commenting on what a shallow vision of democracy this is. Local authorities have a democratic element (albeit one with some serious flaws), but beyond that, public and private sector institutions are presented here as democratising based on… well, it’s not exactly clear. The fact that they are rooted in places? Is having a vested interest in in a particular community really the same as giving up power to that community? A claim is made here that I just can not see the evidence for.
If we are serious about democratising public sector spend, there are established ways of doing this. Participatory budgeting, community commissioning, devolving grant making powers and budgets down to small neighbourhood groups – these kinds of techniques have solid evidence bases. But they are, on the whole, missing from CWB approaches (outside perhaps of North Ayrshire).
Actually existing neoliberalism
The other claim that is made around CWB that I find to be a bit far fetched is that it represents a serious challenge to neoliberalism. There is a very reductive sense in which you can argue that prioritising building local economic strength, simply because that means not necessarily following all market logics to their extreme, means you are striking a blow against our current economic system.
But this is a bit of a caricature of what you might call ‘actually existing neoliberalism’ – because the economic model that has dominated since the 1980s was never quite as free market as some would have you believe. As has been well documented, neoliberalism – despite its globalising tendencies – has managed to find ways of co-existing with nationalisms of various forms. It has also, indeed in Britain itself, found ways of coexisting with forms of localism – as it did during the coalition years.
None of this to say that community wealth building is itself neoliberal. But it is to say that the idea that it represents a serious blow to the neoliberal project… seems like wishful thinking. It might well find itself subsumed - and the fact that Conservative’s who are into ‘community power’ are starting to make distinctly CWB-sounding noises suggests that this is perhaps already on its way.
Quite simply, I do not believe that the revolution will be brought about through procurement strategies. Community wealth building can achieve some impressive and progressive outcomes. But the fact that this seems to have become the centrepiece of ‘socialist’ ambitions in 21st century… that’s just a bit depressing. Because even if we accept that CWB does, to some extent, challenge neoliberal market logics - it still does not really do anything to challenge neoliberal forms of government.
Power remains with the same people in the same institutions. What they are doing with it is a bit different – sure. But the public sector professional, the commissioner and procurement specialist, they remain in control. CWB does have something to say about economics. But it has almost nothing to say about power.
Community wealth building is a strategy. A good strategy! But nothing more. It is not something that you can really argue changes the fundamentals of how either the state or the public sector operate in this country. Perhaps that’s why some local places have been able to implement it even while the national picture remains bleak for the left. But the fact that CWB is something socialists in local government can do right now should tell us something.
It’s just not that radical an idea. The left needs to keep thinking.
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I have been pondering this idea CWB is the thing to transform all things and this confirms my suspicions it isn’t. I haven’t heard anyone claim it is yet it still feels hyped up to me without some formal form of the handing over of power to communities. That in itself sounds more straightforward than it is. Communities are themselves loaded with power struggles and challenges and often given very narrow windows and long tables to exercise power. So people who just throw ‘community power’ around as the thing to shift the current paradigm alone also are guilty of over hyping. So people revert to easier but still ‘nice’ solutions like CWB. Feels we need an example of doing both and doing it well. Whatever well means!
Thanks for posting this - really incisive point made. I agree that a form of local democracy which breaks away from our current model definitely needs new mechanisms of decision-making to empower local citizens.
Personally, I am really excited by quadratic voting and quadratic funding. "QV allows voters to express the intensity of their votes (whilst having a fixed budget of votes/'voice credits'), rather than simply voting yes/no or ranking their choices. In
doing so, QV protects minority interests and discourages polarization."
Quadratic Finance (QF) is a public funding model based off QV. "QF solves the classic “free rider” problem and addresses under-investment in public goods. With QF, individuals can contribute directly to local public projects. Projects with wider bases of support receive larger matches from public funds. QF has the potential to revolutionize campaign funding and local infrastructure projects, among many other areas."
More of this is available in the RadicalXChange Handbook for Radical Local Democracy: https://www.radicalxchange.org/media/papers/The_Handbook_for_Radical_Local_Democracy.pdf
Would be curious for your thoughts on this.
Anyways, thanks again for posting, and looking forward to reading more