Richard Smith: Is neoliberalism the main problem for the NHS?

Is the NHS a victim of neoliberalism?

richard_smith_2014Neoliberalism is destroying the world and the NHS, and we badly and urgently need to find alternatives. That was the main message from a meeting organised by Medact, Health Poverty Action, and the People’s Health Movement. But what is neoliberalism, is it the main threat to the world and the NHS, and what are the alternatives?

We are living in a world that is dangerous, said David McCoy, professor of global public health at Queen Mary University London. The planet is being destroyed. There is growing inequality. Democracy is being undermined. These are, he argues, the result of neoliberalism, but what he called “antineoliberalism”—characterised by populism, xenophobia, and authoritarianism—may be even more dangerous and lead us to another world war.

I share his concerns, but as he spoke I thought of the considerable splash made by Hans Rosling’s book Factfulness, which argues that many things are getting better in the world—not least that the number of people living in extreme poverty has halved in the past 20 years. Globalisation has had more winners than losers, but the winners are concentrated in poor countries and the losers in rich countries, which in relative terms are becoming less rich and having problems adapting. The public intellectual Steven Pinker goes further, arguing in his book Enlightenment Now: The Case for Reason, Science, Humanism, and Progress that “we’re living longer, healthier, safer, richer, freer, happier, and more meaningful lives worldwide.”

Defining neoliberalism (or liberalism or fascism or capitalism) is by no means straightforward, but McCoy had a go. He started by pointing out that it has become so pervasive that it has become normal: it is how we think and behave and is integral to the way we live now. It is an ideology that values markets and competition, sees bureaucracies as failing, promotes the idea of human beings as selfish and makes them greedy, and thinks of elites as wealth makers rather than wealth destroyers. Central to neoliberalism is “the myth of perpetual growth,” that the “rising tide” will lift everybody.

McCoy insists that neoliberalism was planted through a well funded political project. It is, he said, not just a political and economic ideology but a cultural project. (Conspiracy theories always make me nervous.)

Neoliberalism, continued McCoy, has led to globalisation, low taxes, deregulation, economic liberalism, more public management, privatisation, a concentration of power leading to frustration and debt, a weakening of parliaments, and states being “captured” in high income countries or “hollowed out” altogether in low income countries. He took a swipe as well at “plutocratic philanthropy” (meaning, presumably, organisations like the Gates and Chan Zuckerberg foundations), which is “castrating civil society.”

The answer, he concluded grandly, is a movement, a cultural, political, and structural movement to oppose neoliberalism. Having defined the problem, he said he left others to describe the alternatives.

Unfortunately, nobody managed to describe a clear alternative.

Most of the rest of the meeting was about the NHS, which was depicted as a prime victim of neoliberalism. It has led to the NHS being underfunded and suffering from marketisation, managerialism, and privatisation. The point was made that what happened to the NHS was important to the rest of the world as a source of inspiration, but I couldn’t stop myself thinking that the NHS is much studied but little copied—and it’s been studied mostly for its capacity to contain costs. In some ways, the NHS is as unusual as the American system in that it’s state funded, state provided and run, and state regulated; few if any other health systems are like that.

The alternative that was suggested by Jonathan Ashworth, shadow secretary of state for health, was going back to the values that created the NHS. Aneurin Bevan described the creation of the NHS as a “civilising step”: it was “pure socialism” and “pure Christianity.” It embodied values of collaboration and mutualism, which were “bulwarks against neoliberalism.”

There is, of course, a debate about the fundamental values of the NHS. I see them as “available to all independent of means, free at the point of delivery, and equal quality care for all.” The last has always been an aspiration rather than a reality, but like The BMJ I see those as non-negotiable. But others see as values that the NHS is funded out of taxation and entirely publicly run. To me, those are means to achieve the fundamental values and not values in themselves that must be preserved.

Ashworth continued that investing in health is good for the economy. That may well be true for investing in health, but I doubt that’s true for investing in the NHS—because health systems account for only about 10% of health and swallow up resources that would do much more for health if invested in things like education, housing, the environment, and poverty reduction. Ashworth said that the NHS had received something like a 4% increase in funding in real terms for most of its 70 years but that it had been more like 1% for the past eight years (with a Tory government). He pointed out that social care and public health, both now the responsibility of local councils, had been cut in real terms, so putting further pressure on the NHS.

Bemoaning that the secretary of state for health was no longer politically accountable, he promised that a Labour government would repeal the reforms introduced by the Coalition government and increase funding to the NHS, social care, and public health. Much of his speech was an attack on various schemes of outsourcing services to the private sector.

Are the diagnosis that neoliberalism is the main problem for the NHS and the treatment prescribed by Ashworth both correct? Nobody in the audience questioned either proposition, and Ashworth was loudly applauded.

I sat in the audience thinking that I had just sent to The BMJ a blog arguing that there should not be more investment in the NHS and that I had worked for a private American company selling services into the NHS.

One of the speakers argued that there was not a problem with the NHS so why fix it. That is in effect the argument of Ashworth, but I think that few people who have studied health policy would agree. All health systems have problems balancing range of services, quality, access, responsiveness, and cost, and the NHS is no exception. The heart of the problem for every health system in high income countries, including the NHS, is changed epidemiology and demography; the rising cost of medical interventions; and a lack of fit between the services provided—largely designed for acute, episodic care—and the need, which is for integrated, long term care. Attempts to introduce market mechanisms (which have been supported by all secretaries of state since Frank Dobson, including two Labour ones) and outsourcing of some services to private providers are side issues; and increasing funding in the NHS will, I have argued repeatedly, damage health by diverting resources from investments that would do more for health.

Ashworth would no doubt argue that he would increase funding in all those as well, and McCoy will argue that I have been brainwashed, internalised neoliberalism. And it’s true that I attended the Stanford Business School and studied economics for the first time just as the Berlin Wall came down in 1989. That was a high point for what McCoy calls neoliberalism, and Francis Fukuyama’s The End of History and the Last Man was published soon afterwards. 

“For every complex problem,” said H L Mencken, “there is an answer that is clear, simple, and wrong,” and that, I suggest, is the problem with McCoy’s diagnosis and Ashworth’s treatment. Some of the analysis around neoliberalism—for example, “the myth of perpetual growth”—is right, and some of Ashworth’s policies—for example, increasing funding for social care—are right, but the whole package of both is oversimplified.

Richard Smith was the editor of The BMJ until 2004.

Competing interest: RS is an NHS patient and has no private insurance and has never had. He was a member of the Labour Party’s Independent Commission on Whole Person Care. Until 2015 he was employed by the UnitedHealth Group, which has customers in the NHS, although he had nothing to do with the business side of the company from 2007. He still has shares in the company. He is also the chair of the board of Patients Know Best, which has customers in the NHS. He is unpaid but has some equity. The views expressed in this piece are entirely his own.