Welby: Wonga

God of the gaps

Justin Welby is a hypocrite, but his credit union plans are a symptom of the decline of the workers’ movement, argues Paul Demarty

It is an odd quirk of wealthy Christian sects - every so often, their leaders, against all common sense, dare to make pious noises about usury and exploitation.

God only knows what puts the idea in their heads. It is in the Bible, I suppose, but so is the notion that a woman cannot be touched during or immediately after menstruation; the dedication of the early church to the poor is hardly in keeping with the modern world, entirely beholden to Mammon. The Catholic church, with its untold billions, and the Church of England (whose investment portfolio is more modestly estimated at £5 billion), are hardly in a good position to decry avarice.

And yet … Pope Francis continues his cloying quest to rebrand the Vatican as a ‘poor’ church, most recently with a visit to Brazil. The irony of all this taking place amidst enormous financial scandals surrounding the Vatican bank can hardly be missed, but then the new pope - named after the beggar, St Francis of Assisi - still escapes criticism; surely the ‘poor pope’ will bring these gluttons to heel?

In the generally less dramatic world of the Church of England, meanwhile, the new archbishop of Canterbury, Justin Welby, has declared ‘war on Wonga’ - referring, of course, to the infamous payday loan company, which lends on a short-term basis at an attractive annual percentage rate of 5,853%. Behind the feel-good advertising, it is straightforwardly obvious that Wonga - and less prominent payday lenders - are pretty cynical operations, making absurdly exploitative gains out of the general situation of social desperation and the reluctance, post-crash, of banks to offer easy lines of consumer credit.

A great target for a would-be saviour, then, who wants to clear out the money-changers - religious critiques of finance capital have a long and ambiguous heritage, covering religious-utopian communism and medieval (and modern) anti-Semitic attacks on the usurious Jew. Welby’s response, at least, is a little less tarnished: a revival of credit unions, with the assistance of the Church of England; indeed, unlike certain cousins (mutuals spring to mind), credit unions survive (recent Bank of England figures put total membership at over a million).

Welby, alas, has already had his anti-loan shark crusade interrupted by one of the C of E’s increasingly common fits of embarrassment. Part of the church’s £5 billion ‘ethical’ investment portfolio is a stake in VenCap International, which unsurprisingly puts money into venture capital firms ... including a certain Accel Partners, one of Wonga’s main financial backers. Whoops!

Our archbishop, fortunately, was not immaculately conceived - he has many years’ experience in the upper echelons of the (oh so ethical) oil industry. He knows how money works; he is no doubt very pleased that he has inherited a financial empire whose ‘ethical’ strictures are as lenient as the Church of England’s investment fund guidelines, whereby only 25% of a company’s profits can arise from usurious lending practices (other notable restrictions include a limit of 3% for pornography, apparently over three times more sinful than arms production at 10%). It is probably easy enough to prove VenCap falls well under such a generous threshold.

A seasoned capitalist like Welby will be painfully aware of how hard it is to trace your money once it goes into any investment fund (the complexity and opacity of transactions in high finance, after all, was a proximate cause of the 2008 crash). He is unlucky that the media were so rapidly able to bridge the degrees of separation between himself and the payday loan business, and may perhaps hope that the big man upstairs is not so assiduous in his hypocrisy-hunting.


It would be easy merely to mark the gaffe, file it with all the other small hypocrisies of the ruling establishment and move on. Yet this affair illuminates something wider about how capitalist societies actually operate. The most explicit ideologues of the market claim that it can satisfy all human needs - they trace this ‘observation’ back to Adam Smith and the ‘invisible hand’. There is, as it happens, a Hegelian ‘Marxist’ version of this theory, whereby all society has become saturated entirely by the abstract domination of the commodity form. Both versions are equally false.

The underlying drive of capital as a social relation is to maximise surplus value, which comes up against the natural limit of the human body, which can only work so many hours, and only if it metabolises so many calories. Capital as such has no direct means of accounting for these limits; yet the attempt to breach them in the first instance is ultimately economically unsustainable (you cannot work people to death faster than they can reproduce), and equally politically unsustainable (people are wilful things, and tend to object to being worked to death).

The total reproduction of a capitalist society, then, depends on economic and political forces outside the market obstructing the naked, bloodthirsty rule of capital as such. The market does not, and cannot, have total (rather than relative) domination over social life.

A pertinent illustration in recent history, worth bearing in mind so far as Welby goes, is the Egyptian Muslim Brotherhood. It emerged from the 2011 uprisings the strongest organised force in part because it had formed a whole network of social welfare organisations, under the tutelage of MB branches and sympathetic mosques; it was able to do this thanks to the departure of the Egyptian state from such functions in the age of what is imperfectly called neoliberalism.

The MB is not in any sense, as the intervening years have made clear, an anti-capitalist organisation; one of its other advantages compared to other political trends, of course, was Saudi and Qatari oil money. Yet it, like many reactionary-religious organisations, was pulled into a void abandoned by official capitalist society, and (for a time) reaped political and ideological benefits from filling it.

Without pushing things too far, there is another commonality between the Egyptian situation and our own - the profound weakness of the organised left. Justin Welby wants more credit unions; but whose idea was that? In its modern origins, it is an outgrowth of the early German cooperative movement - not strictly working class at the beginning, but rapidly taken up by Lassalle’s General German Workers Association, and the nascent working class movement internationally. Credit unions were (in some respects, still are) part of the broad defensive armoury of the working class.

Today, some of those defensive institutions have almost disappeared (mutuals, workers’ educational societies), others have become impenetrably bureaucratised (the unions, the Co-op), and many of the rest have lost their direct ideological connection to class solidarity. Welby’s plan has attracted such attention because he can pose it as a matter of ‘community’, of cosy localism; the church is as much part of the neighbourhood as the credit union, after all.

Always on hand to split the difference between nostalgic reaction and class solidarity, ‘Blue Labour’ guru Maurice Glasman popped up in The Guardian to offer his input - he wants a grand coalition of Labour and “faith groups” to fight for a cap on interests rates and for an increase in community lending (July 26).

Glasman is an oddball character, but he remains practically the only mainstream policy wonk with any big ideas in his head. He is also, sadly, far better plugged into this side of the labour movement’s history than most of the far left. The natural flipside of the Hegelian view of total domination of the commodity form is a fetishisation of the strike as uniquely disruptive to the logic of capital, and a vulgarisation of Marxist critiques of Lassallean and Proudhonist fetishisations of the cooperative, which sees mass day-today organisations of the class other than trade unions as somehow a waste of time. Yet trade unions themselves took on many of these broader functions of solidarity when they were healthier than they are now.

We are left, then, with no prospect of seizing this ground back from reactionaries like Welby - and make no mistake: for all the right-on PR, the Church of England is every bit as reactionary as its confessional competitors. The sight of a whole series of soft-left types applauding Welby’s ‘tough’ posturing on predatory lending is a depressing one, but the inevitable result of this situation.

The Church of England is able to step into this breach, rather than us, most immediately because it is more socially powerful at present than the workers’ movement; sure, church attendance is declining quite as much as trade union membership, but there is the small matter of that £5 billion investment pot, plus landholdings larger than any British institution other than the monarchy.

Yet it also has a vision - the nationalist-nostalgic myth of old Albion; as the motto of the Tory right Cornerstone group has it, ‘Faith, flag and family’. The left, instead, is reduced to purely negative platitudes about how bad austerity is, coupled (if you are lucky) to a technocratic fantasy Keynesianism. A hypocritical oil-man like Welby gets to be the god of the gaps in social welfare only because the revolutionary left has forgotten its own history of building up the institutional strength of the class it is supposed to lead.