“The Coalition’s extreme austerity policy is the biggest economic gamble I have seen a British Chancellor take in my lifetime. With my heart, I hope for the sake of the country the wager pays off, but in my head I fear that this unjust, unjustified and unnecessary programme will cost us dearly as a nation.”
– Professor John van Reenen, London school of economics
Today I spoke on the phone to our Liberal Democrat candidate for MP. He came 2nd in the May 2010 election, losing out to the Tory, but he is still a candidate and still campaigning for the Lib Dems. I sent him an email, and he very kindly rang me back. I asked him questions regarding the Coalition rhetoric on the economy. I specifically asked him what had changed economically, to make the Lib Dems think their committment and pledge to abolish tuition fees was suddenly not feasible? He didn’t offer me a good enough reason. I pointed out that when Vince Cable said at the beginning of October, that the economic situation was worse now and so they had to abandon the tuition fee pledge; that the situation was actually better, than when they were running for the student vote, in May. So, he blatantly lied. Our local candidate said “yeah”. He also told me that the Lib Dems wanted coalition with Labour, not the Tories. So it amazes me when they spend every moment that they are awake, insisting everything is Labour’s fault. It is following the line of Tory discourse. I massively appreciated him giving up some of his time to allow me the chance to question him, and he answered very honestly; annoyed at much of what has happened and the direction the Lib Dems seem to be going. I get the feeling this Coalition isn’t going to last very long.
When the Chancellor announced the spending review in Parliament last week, he specifically made the point that Britain was the ‘brink of bankruptcy’, and that it was all Labour’s fault. On Tuesday this week, it was announced that the British economy is growing faster than expected. Obviously George Osborne claimed all the credit for this, essentially missing out the fact that none of his economic policies have actually been implemented or had any time to settle in whatsoever. We went from the brink of bankruptcy, to growing pretty well, in the space of 6 days. Impressive. Osborne claimed it was all due to confidence in the proposals by the government. Which is an absolutely ludicrous claim to make. I cannot imagine in the space of three months, markets have decided to suddenly start growing in unison, whilst banks start lending, all because there’s a new Chancellor in town. That just doesn’t happen. I hope though, it will make the Tories step back from the rather amusing claim that we are about to become the next Greece. What the rise actually shows, is the strong construction sector, due to public sector contracts, has provided much of the growth. This is likely to slow right down, after the axe actually hits its target. Improvement and maintenance to schools for instance, which was part of Labour’s stimulus package, is set to fall by 40% because of the cuts.
Osborne taking credit for the growth is eerily reminiscent of when Republican Congressmen in the States angrily complain about the stimulus package, but happily stand in front of cameras holding the cheques for projects that it paid for in their district, despite their fierce opposition to it. Osborne is doing the same. The stimulus created this growth, the Tories angrily opposed the stimulus, and now they are taking credit for its benefits. And a dumbed down British public, too obsessed with X Factor, will believe it. I’m pretty sure a further 500,000 unemployed in the public sector, which will obviously hit the private sector too, might mean that growth figure drops quite harshly over the next twelve months; I wonder who Osborne will put the blame for that on.
The stronger than expected growth figures, mirror those of this past July, in which GDP grew 1.1%, when the forecasts were just 0.6%. In April – June, the Construction Sector grew by 6.6%, it’s highest rise since the 1960s. In the second and third quarters of 2010 – still, without any Tory policy implemented – the UK economy saw the fastest consecutive growth in over ten years, suggesting that Labour might have got it right after all. Surely Osbourne can’t take credit for that too? The Party line seems to be; when it’s bad, blame Labour. When it’s good, take all the credit.
The Tories announced that we have secured our Triple A credit rating; despite the fact that it was never actually at risk. It was always secure. In five months in office, they are claiming to have secured a credit rating on the back of the worst financial crises (caused entirely by the Private sector, nonetheless) in decades, and are apparently solely responsible for the growth figures. It’s beyond moronic.
Nobel Prize for Economics winner, Joseph Stiglitz recently criticised the way the Coalition is dealing with the economy (in direct conflict with the 35 business leaders, but then Stiglitz doesn’t fund the Tory Party), by saying:
“I feel sorry for the Irish people who have to suffer from this policy… but it doesn’t have global or European consequences. If the UK, Germany or other countries do it, then it is going to have systemic consequences for Europe and the whole world. If that (austerity) happens I think it is likely that the economic downturn will last far longer and human suffering will be all the greater,””
Tough cuts to the Irish public sector, lead to huge unemployment and declining output, and certainly not a bustling, wondrous, all encompassing private sector as promised to us by the Big Society brigade.
Today, Lord Turnbull, the former head of the Civil Service told a Treasury Select Committee that Britain was not on the brink of bankruptcy. He’s right. The idea that a Triple A rated economy, which happens to be the fifth largest in the World, and the second largest Financial centre in the World, is on the brink of bankruptcy is an amazing thing to suggest. It is simply a backdrop for these horrific cuts the Government announced last week. But one has to ask the question, if growth is far better than expected, and we have ‘secured’ our credit rating, and we are no longer on the ‘brink of bankruptcy’, there is no economic reason for such harsh cuts any more. The only possible reason to push forward the cuts, would be for the sake of ideology? What the Tories actually inherited was an economy coming out of troubled times (so, growing) and falling unemployment figures, which is actually astonishing given the extent of the crises we have just been through.
But this isn’t the best bit of Tory bullshit to grab my attention today. Remember, we are all in this together, that includes the people on disability allowance who will get it drastically cut after a year; the people who will be purged from London because of the housing benefit cut; and of course the poor FTSE 100 bosses, who it was announced today, have awarded themselves greater pay rises and bonuses than at any time over the past few decades. The average FTSE 100 boss, now earns over 200 times the average worker wage. Bonuses to bosses increased by 34% on top of a 4% average pay increase. J Sainsbury gave its CEO a 60% pay increase. The boss of Reckitt Benckiser, which makes Gaviscon, is the most highly paid on the FTSE 100 list of top paid execs, taking home £90m. This comes a couple of days after the BBC reported that Reckitt Benckiser had agreed to pay a £10m fine for essentially, ripping off the NHS by “restricting competition in the supply of heartburn medicines to the NHS”. Good to see he’s earning his £90m.
Paul Kenny, general secretary of the GMB union, quite rightly told the Guardian:
“Let us not forget that these are the same people urging the Government to make deep cuts in jobs and services and in the welfare on which the poorest in our society rely”
This all of course, comes a few days after a Channel 4 investigation, suggested that certain Tory millionaires, including George Osbourne himself, have been making money from tax loopholes. The investigation claims that Osbourne will benefit from a £4m offshore trust fund, which in turn will save him £1.6m in inheritance tax. He did nothing to earn that trust fund. He didn’t ‘work hard’ for it. Transport Secretary Philip Hammond apparently avoided the new 50p top rate of tax, by moving all of his shares from his family property business, into his wife’s name, who pays less tax. These people are really taking the piss at the minute.
Instead of taking to the streets like the French are doing, we tend to praise these bosses and attack Unions. Whenever there is a strike, our media convince us beautifully that the workers are trying to destroy the company and ruin our lives. It couldn’t possibly be the bosses fault, they couldn’t possibly be to blame. How fucking dare people demand to be treated better? We see their striking simply as something that inconveniences our neat little consumer obsessed World. We don’t see them as people fighting for their jobs, against a class of people who simply want to enrich themselves further, despite the fact that they take home millions already. We should all be hand in hand with every striker in the Country, because the majority of us have far more in common with the ordinary worker being pissed on, than we ever will with the bastards who sip champagne on their boats. We have become massively Thatcherite in our thought process. I hope this changes soon.