The recent actions of Philip Green – the billionaire retail tycoon – have been condemned from all sides of the political sphere; few of these condemnations, however, try to address the underlying problem. Richard Fuller, a Tory MP, called Mr Green the “unacceptable face of capitalism”. This is inaccurate: Philip Green is actually the true face of capitalism.
Philip Green purchased BHS for £200 million; within the first few years alone he was paid out £400 million in dividends. Meanwhile, as “Sir” Philip laughs all the way to the bank, BHS is set to collapse under the weight of its £571 million pension deficit, with 11,000 jobs at risk. After sucking the company dry and selling it on for the nominal sum of just £1, Green has left BHS workers with a precarious future ahead of them. Not only do they face the uncertainty of unemployment, but they have seen their pensions vanish before they eyes too…vanish only to reappear in the already bulging bank account of Philip Green!
Even Conservative MP David Davis was compelled to assert that Green’s actions were “little else than asset stripping”, whilst Roger Mullin of the SNP described Green as "little better than a corporate crook". Other MPs hit the nail on the head, correctly stating that the billionaire boss was responsible for “wealth extraction rather than wealth creation”.
Capitalism’s legal theft
Before we even start analysing the collapse of BHS, we already see one of the most clear modern examples of exploitation of workers: in just a few years Mr Green received in profit double what the company was worth. The BBC described Green’s removal of the profits via dividends as ‘quite legal’.
The question is not simply about the legality of his actions, however; what people are rightly questioning is whether we want an economic system that allows this? Green’s actions, whilst legal, demonstrate the owners of big business are concerning only with maximising their profits, regardless of the effect it has on the working class. Any economic system that allows – and, in fact, promotes – this level of greed and theft needs to be abolished.
Mr Green, prior to his dividend payments, was not short of money or struggling to eat. It is predicted that the retailing fat cat has a staggering personal wealth of around £3bn. This man, who has more money that he could ever spend, would rather parasitically fill his pockets than allow his workforce to have their pensions. The money that these people have worked all their life for is now just another digit in the bank account of a greedy billionaire – a man so rich that former BHS employee Lin Macmillan called for Mr Green to sell his luxury yacht to ensure the future of BHS’ 11,000 staff.
You could say that Philip Green, in some regards, is a very generous giver: in 2005 he paid £1.2 billion in dividends to his wife. What makes this blatant fraud even more unsettling is that his wife resides in Monaco, meaning she does not pay any taxes in the UK. To put this vast quantity of money into perspective: this is nearly double the money needed to provide pensions for the entire BHS workforce.
Losses nationalised; profits privatised
The events surrounding BHS are not just a single irregularity, however. Most worryingly, this aggressive and cannibalistic form of capitalism is happening on a global scale constantly. The outrage and anger over Green’s actions and the collapse of BHS are perfectly understandable. But the same thing that has happened with BHS has been carried out on a national-scale by the Tory government, and governments of all countries, who are intent on making the working class pay for a worldwide economic crisis and collapse that they did not cause – a crisis of capitalism.
As is always the case under capitalism, the losses from the economic crisis have been nationalised and the profits have been privatised. Ordinary families have been asked to foot the bill, whilst the 1% continue to collect their eye-watering bonuses and accumulate wealth.
The economic crash was clearly not the fault of the working class, who everywhere work long hours for little pay. Undeniably the crash was caused by the bosses and bankers – and yet they are continuing to pay themselves handsomely. Meanwhile, austerity is being imposed on those who did not cause the crisis: workers, the youth, and the poor. Services that working class communities rely on are being systematically dismantled because of the inherent greed of the capitalist system.
At BHS, the big winner is Philip Green – at the expense of his workforce. Across Britain and internationally, the winners are the super-rich, who since the crash have doubled their wealth, while millions of the poorest are forced to face the brunt of austerity and attacks.
The fact is that bosses like Green have the money to pay workers’ pensions, and in Britain we have the money to bring an end to austerity. In both instances, the real problem is that this money sits in the hands of the 1% and is used to line their pockets, rather than to meet the needs of society. To stop the events in BHS from being repeated we need to take this wealth out of private hands and place it under the democratic and collective control of society, in order to provide decent jobs, pensions, and pay for all. In short, we need to put an end to this exploitative economic system that is capitalism.