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You have to admire Tory nerve in claiming cuts all about fairness
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18 October 2010
The coalition may have a tricky week ahead of them, but they continue to have media opinion (not to be confused with public opinion) blowing a favourable wind up their bums and into their sails.
Or, to put it more favourably for their strategists, they have done a good job in winning the battle of the political narrative.
So when 35 business leaders write a short, bland but supportive letter to the Daily Telegraph (a device which served the Tories reasonably well in the battle over national insurance before the last election) the broadcast media follow along nicely.
Yet over in The Guardian was a piece from Mark Serwotka, general secretary of the Public and Commercial Services Union, which I for one found to be more detailed, better argued and, given the drift of the narrative referred to above, more newsworthy, if news is defined by that which we are not expecting. Feel free to correct me if I'm wrong, but I would hazard a bet that the business leaders (many of them hardy annual Tory supporters) have been getting more media traction than Mr Serwotka.
What I liked about his article was his challenging of the Cameron-Osborne narrative which most of the media have accepted almost without question. Here is a short extract.
"The collapse in the finance sector, due to greed, caused a sharp recession and higher unemployment, tax revenues shrank dramatically, and the welfare bill increased. In making cuts, the government is making a political choice, not responding to 'record' debt. Research by my union shows that, between 1918 and 1961, the debt was more than 100% of GDP. Osborne's budget papers put the current debt at 53%. Between 1918 and 1961 different choices were made. We established the NHS and welfare services, built council houses, developed state education and pensions, and invested in industry. Instead, Osborne is choosing to realise a long-held ambition to rid the rich and powerful of the burden of the welfare state. The way we pay benefits to those in need, how we get people back to work, our ability to collect the tax that funds healthcare, education and other vital services for millions of people – no corner of government will be spared the axe."
Doubtless some will say that his members fear for their jobs and so he is a vested interest putting a narrow point of view. And the business leaders in The Telegraph? Well, if you accept the tone of the coverage so far, they are like independent voices of wisdom speaking only with an obvious national interest in mind.
The role of the moneymen in getting us into this mess appears to have been forgotten. Now teachers with a pension, medical staff on the allegedly safe frontline, not to mention people who hold out the hope of getting a home, are the enemies of the State as viewed through the lens of its leaders and their media cheerleaders.
Amid all that, it was good to see Mr Serwotka put an alternative view. And good to be reminded that government is about political choices. The Tories are making a political set of choices, using the deficit as the reason to make them, the Lib Dems as cover, and pretending it is all about fairness. For sheer nerve, you have to doff your caps to them.
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The amazing thing about the National Insurance battle, which did change the pre-election tone, is that the Tories lapped up the business leaders’ support, and then proceeded to carry out (in the so-called emergency budget) Labour’s planned rise in employers’ NI themselves. Where was the coverage of that? Where were the whinging business leaders then? I couldn’t believe it when my finance director confimed this. Chutzpah or cynicism (epecially from those business leaders)?
You have all forgotten Brown’s limit of 40% of GDP being the public sector borrowing allowable for 11years of New Labour. “Prudence” you all cried, and added tens of billions by PFI!
Now the 2012 estimate is nearly 100%of GDP, and you and your mate Serwotka say it is unimportant. ( He mentions the current 53%, but makes no mention of the 2012 projection). Spin it brother!
The BBC radio news have slightly amended their reporting of the business leaders’ letter by adding ‘some of whom are Conservative supporters’. Some??
Good for Mark Serwotka. I think there’s something of a peasants’ revolt brewing up on the internet. It’s mainly on the net that you can read and learn about the alternative view on the cuts, so disgracefully swept under the carpet by the mainstream media. On news websites, where there are comments sections, it’s very noticeable that commenters parroting the government line are very poor on facts and figures, whereas those arguing the opposite have a much more compelling case, which they can back up with solid evidence.
It’s also interesting to read the pithy comments on Twitter – for example when Baroness Warsi appeared on QT, her ‘we had no idea about Labour’s mess’ mantra came under a lot of attack. The general view was that this line is a quite evidently outrageous lie. Particularly among young people, there is an increasing anger that they are going to be the fall guys for the bankers, those who actually caused the crisis. The ConDem assumption that the general public are gullible fools who willingly swallow their propaganda is a very mistaken one.
Agree. You can’t have Tories and fairness in the same sentence can you. Give the Tories enough rope…..
Britain´s economic troubles are consequence of crisis of globalisation. The economic crisis was global – and still is. It is a crisis of capitalism. Britain was vulnerable as the City of London is a hub of international finance.
It took years for the 2007-08 banking crisis to built up in China and the US. Bubbles were created.
Britain now faces £83bn cuts. They will bring poverty and inequality. At least 1 million jobs will go. According to OBR unemployment will be only 2 million in 2015. This is difficult to believe.
Markets and credit-raters are not demanding cuts on this scale. They are ideologically driven and incompetent. The coalition´s Hooverite obsession with cuts is based on rightwing ideology aiming at small state.
Because of quantitative easing quarter of national debt is owned by the Bank of England. So the government is paying interest to itself!
The NHS makes 32% of departmental spending. It is a mistake to ring-fence it.
The ratio of deficit reducing should also be different. Perhaps even 50:50 between the cuts and tax rises. In Sweden it was 53:47, and in Canada 60:40. The cuts could also be made over six years.
Financial orthodoxy says that government borrowing causes interest rates to rise. But Keynesians know that the real problem is the shrinkage of the economy.
Public sector is not “crowding out” private sector.
Are there any alternatives? Yes. Tackling unpaid taxes plus tax evasion and avoidance could bring in more than £50bn. Tripling the bank levy would bring extra £6bn. And Robin Hood tax on financial transactions £20bn.
Both proponents and opponents of the austerity measures claim that cuts will be savage. But in reality they appear to be relatively modest.
Had state spending risen in line with inflation since 1999-2000´s £343bn, it would have reached £450bn by 2009-10. Instead, it increased 53% in real terms to £669bn.
Total state spending will now be £686bn at 2010 values by 2015-16, still higher than it was 2009.
But increased interest payments and the protection of the NHS and international aid mean that there will be less money in other Whitehall departments.
Debt is the sum total of all the deficits accumulated over time. The deficit is the result of banking crisis and economic crisis.
It was markets that failed – not public sector. The coalition´s Big Lie is to blame Labour for global crash caused by bankers for political reasons only. Tactician George Osborne tries to make world-wide problem to look like domestic one.
But by ignoring the continueing weakness of the global economy the coalition is risking the UK recovery.
Ann Pettifor gives a whole new perspective to the debate in the Guardian.
The UK Treasury cannot cut the deficit, only government expenditure. Whether deficit comes down depends entirely on how the rest of the economy reacts.
If confidence falls, private sector investment stalls and unemployment risies, then tax revenues will fall and welfare payment will rise. And the deficit will soar – regardless of cuts!
According to Ms Pettifor deficit cannot be brought down by slashing government spending. Only by public sector stimulating the private sector can we reduce the deficit.
Because of the failure of the banking system, the private sector will not be stepping in to compensate for cuts.
Expect the budget deficit to rise!
I want to press your like button a hundred times Alastair, but I would never want to doff my cap to any of them if I had one 🙂
I agree with ‘Nicky’ in that looking for a balanced (no pun intended) view of the figures is difficult, especially from ConDems, possibly because the coalition don’t have a coherent financial policy. Yes, there have been problems with regualtion, Brown turned the City into a cash-cow and pumped it for all it was worth, but there is no evidence to suggest that the Tories would’ve behaved any more responsibly. But, this was a global crisis of unprecedented proportions. Markets failed, not the public sector. The shrinking of the public sector, and the blatant attack on the Welfare State scream of idealogical narrative and lack Economic perspective. It’s not the figures presented don’t add up, insidiously, the figures havn’t been presented. Abolition of Quango’s is so much smoke and mirror’s that producing marginal savings. Osbourne on JM Sunday morning referred to ‘the mess of the last govt’ 6 times but didn’t present any detailed monetary defense of economic strategy. He has none.
I have long given up on getting fair coverage on the BBC, and The Guardian is suffering Clegg-itis. Today the streets of France are alive with riots. Typical of the French, one might say, but are the British going to wait and see what we havn’t got before we respond? Information is power. It’s a concern that I find more informative articles written by two bloggers (thank you Olli) on your site than than from main-stream press.
This week things may get clearer, but I fear not better.
Michael White has written a similar piece today.
I’m fully fed up with the ‘Owing to the current economic climate we’re re introducing child labour. We don’t want to but it’s unavoidable. It wasn’t in our manifesto but this is a coalition.’
You omit to mention that during the last election campaign BOTH Tory and Labour used letters signed by “experts” and “businessmen” to argue for and against NI increases.
And could it be that media opinion is blowing up their bums (as you so crudely put it) because they see two parties dealing with an ongoing financial crisis in the best way they know how. Imperfect it certainly is but at least they are trying to deal with it rather than pretending it might all go away.
Wasn’t it Serwotka who branded Labour as ‘worst government ever’ last April?
“We have abolished boom and bust.”
“I will not allow another house price bubble.”
You whine about how the Conservatives deal with a problem you said you had solved and then created to its most devastating effect since the Depression. For all your talk about the “international” crisis, you just can’t accept one single thing: the coffers were empty and we were living off borrowed money before the crisis even started.
If I may say so Chris I think that’s a very naive comment.
The Tories are re-structuring the NHS right now so that they can fulfil another long-held ambition, to transfer the cost of the NHS outside public finance. Yet it will cost a lot of money to trigger such a transformation despite this being the worst time you could possibly imagine to do it, and of course they didn’t mentioned it in their manifesto because they wouldn’t have been able to justify the cost if they were asked.
As Alastair has said, they are making political choices – they are not administrators clearing up a liquidated company, but stubborn out-of-touch polititians desperate to implement policy that they wanted to implement 15 years ago.
Don’t believe such a cowardly “the coalition is trying their best” nonsense argument – they are making political choices that they don’t have the courage to stand in the front of the country and present – the best that they can do is to present principled choices as emergency measures whilst crying “it’s the only way”.
With Labour on the other hand – you knew where they stood, you always knew what they were doing and what they believed in. Agree or disagree with Labour – Tony Blair, Gordon Brown – but at all times, they had the courage to stand in front of the country and explain the political choices that they were making and why.
I can’t spot a single non-Labour polititian today who has the same basic ethics and it’s an undemocratic disgrace.
I just cannot take you seriously – are you honestly supporting a Union leader who believes that the Coalition want to ” rid the rich and powerful of the burden of the welfare state ” ? Thats so infantile and just plain wrong,no one in the Tory party or the Coalition belives that.
Can one of you on this blog answer why the Northern Rock was allowed for so long under GB and Labour to lend so recklessly ? Why a small Scottish Building Society was allowed to buy US sub-prime mortgage bonds? Why the Alliance & Leicester and Bradford & Bingley were allowed to lend so much to very poor credit-rated people? and also as to why they all went bust ! ? Are you suggesting GB and Darling didn’t know the above?
Why was every man . woman and child in the country allowed to have 10k of personal debt or the equivalent? (away from any mortgage that is ) ?
Why did we not have anything left in the tank so cope with a crisis ?
Why the State employed an extra 1m workers with absolutely no accountability on results and waste?
ANY ANSWERS?
p.s your union friend picks dates in history where we fought 2 world wars and built the national health service so of course the % of debt ve GDP would be higher – what a ridiculous comparison – come on guys on here argue with some brains pls !
Just one tiny point, I don’t remember Brown having the “courage to stand in front of the country” when he abolished the 10p tax rate buried on p560 of the Budget; nor do I remember Blair being similarly straightforward when presenting his dodgy dossier. Come off it Chris, Tory, Labour LibDem politicians – all economical with the truth when it suits. That said – and I agree it wasn’t in their manifestoes – credit for tackling the mess left by Brown in a manful way.
I really am apalled at the way the media do not challenge the tory lies.
‘We have no alternative, but to ruin the lives of millions of people, because of the mess left by labour’. Come on this needs to be challenged, there must be a BBC presenter in there somewhere with a set of balls!!
Bang on!
And why here in France is mortgage lending stricly regulated to income? All lenders would give the same max figure to the same applicant: result no such house price inflation as Brown encouraged and led to his credit boom.