Tuesday, 8 June 2010

We need to defy the market fundamentalists and their painful cuts

Government debt is currently around 11% of Britain's Gross Domestic Product (GDP). This, according to the government and their "free" market cheerleaders, is "unsustainable." Hence the need for "painful" cuts to public finances.

This argument is rebutted by basic economics.

My fiance's and my household debt currently runs at around 27% of our income. This is annoying and very often stressful, but in no way would I call it "unsustainable." It has not changed our life substantially. We haven't had to cut either basic services for those living in the house. For that matter, we haven't even had to cut luxuries such as Sky TV. We certainly haven't had to reduce the amount of creatures dependent on us by giving away a cat or the dog. In fact, we will be increasing the number dependent on our money if we succeed in conceiving a child.

If, however, we did have to make cutbacks, then we are perfectly capable of being sensible about it. We wouldn't stop buying food for an animal, for instance, so that we could keep a credit card. Especially if that credit card were responsible for our debt being the level it is now.

If that credit card was not only responsible for our debt but had brought us to the brink of bankruptcy and homelessness, we certainly wouldn't abandon the animals to fend for themselves whilst continuing to rely on the credit card without a thought to the consequences. We couldn't justify that as "painful" but necessary on the grounds that putting the welfare of living beings before money that doesn't really exist was "unsustainable."

Nonetheless, that is what the government are going to do. To add insult to injury, they wants us to help them do it;
Chancellor George Osborne has pledged a "fundamental reassessment" of the way government works as he outlined plans to involve the public in making cuts. 

He said he wanted the "best people in their fields" from inside and outside government involved and a "wider public engagement exercise" over the summer.

Every spending programme would face "probing questions", he said - including whether it was essential, could be done cheaper or could be delivered by the private or voluntary sector.

He pledged to involve people from inside and outside government in a consultation over the summer including think tanks, pressure groups and people working in front line services.

Civil servants as well as head teachers, police officers, nurses and others would be asked to contribute, he said.

"What we want to do is make sure that all political parties, that the brightest and best brains across Whitehall and the public sector, that voluntary groups, think tanks, trade unions that members of the public are all engaged in the debate and discussion about how collectively we deal with the problem - after all it is our collective national debt," he said.
If it is "our" collective debt, is there any chance that we could "choose" to address it in a way that defies the right's market fundamentalism?

Somehow, I doubt it. Like the recent parliamentary elections, there will be no "none of the above" option. Our choice will be nothing but a pale illusion, allowing Osborne and the other smug bastards in parliament to swing the axe whilst blaming the wounds on those who suffer them.

When the public deficit is £156bn, and the official cost of the bank bailouts was £850bn  (other estimates as high as £1 trillion), the obvious question remains unasked. Why are the public suffering painful cuts at all when those responsible for the crisis are once again making profits and paying themselves huge bonuses?

Moreover, we might ask why is it public services that working class people rely on which need to suffer cuts. If we are looking at government expenditure, then alongside public services (and the bailouts) we have the £18bn cost of the illegal wars in Iraq and Afghanistan, the £1.7bn yearly (or £100bn lifetime) cost of the Trident nuclear deterrent, the £5bn per annum cost of government business grants, or the £10bn yearly cost of fuel subsidies for airlines.

That's just for starters. Our economic system is corporatist, not socialist, which means that if we really want to make cuts and savings the best place to start is with corporate (not social) welfare.

But, of course, that isn't going to happen. Our system, including the Ministry of Defence, is one of private profit and public loss as subsidised by the taxpayer. As long as that remains the case, then the mess caused by big business will always be "our" collective debt.

Osborne's "choices" will not offer us an alternative to this reality. We must make it ourselves. The first step is to reject market dogmatism and organise for resistance.