We begin with the people and they have to define the position. So relationships first, then build power among those people where they agree. So, base… - Maurice Glasman, Baron Glasman

Capital has just become completely disconnected from the people. Labour was born in the world to resist the domination of capital. That’s our thing. So we say that five percent of the bailout should be used to recapitalise local banks. It’s our money anyway. Those local banks should only lend in the area that they’re in. Germany’s a very successful, a very, very successful example of how this can work.

And what is going on is that the SPD (Social Democratic Party of Germany) has lost the trust of working class German voters, is overwhelmingly a party of the public sector, social science graduates and ethnic minorities and won barely more than a quarter of the vote. It has moved its concerns from those of the internal governance of the political economy to a political and legal orientation that requires the passing of laws, external regulation and redistribution. It has not seriously defended the internal virtues of its economic system, preferring to stress external factors such a stimulus and taxation. Justice and rights rather than democracy and the good have come to define the position. I am strongly suggesting the party has become liberal rather than socialist and that is the fundamental problem.

Regional Banks that are constrained to lend within a particular area are a necessary part of the institutional ecology in that they resist the centralising power of capital, allow a more stable access to credit for regional and smaller businesses and encourage relationships and reciprocity to constrain the demand for higher rates of return that have decimated the mutual bank sector in Britain. They also offer an alternative to usurious lending, one of the great growth areas in our economy. Any serious reflection on ‘employment policies’ must confront the centralisation of capital and the state and seek to constrain both through the endowment of decentralised regional and sectoral institutions that constrain centralisation and preserve and renew traditions of virtue within the economy through resisting the commodification of human beings, nature and knowledge demanded by the maximum return on investment. It allows initiative and enterprise to be oriented towards the future.