It is astonishing that sado-masochism, so beloved of the English upper classes in their sexual antics, is so infectious in the Labour Party, albeit in a very different context. There seems to be an obsession in some sections of the party that once the Tories go down the route of self-destructive austerity, we must at least match them or even preferably out-austerity them – self-flagellation in true Lutheran style – in order to prove our ‘credibility’ or to display ‘realism’.
The Guardian, or at least the Blairite wing of its political journalists, is intent on pursuing this line for all they’re worth, whilst giving no coverage whatever to the alternative view which makes much more sense. Now we’re told that Gavin Kelly, chief exec of the reputable Resolution Foundation, is saying Labour must face the facts on future spending. To that I say, bring it on. Let’s start by looking at the true picture.
The whole debate is conducted, unquestioningly, on the basis that there’s no money available – it’s all just a matter of how much spending is cut and where. Now nobody is suggesting that all public spending should be automatically protected and no cuts be made at all: of course it’s sensible continually to review public expenditure regularly to make sure it’s all providing the best value for money, and if not, either cut it or spend it differently. But that’s completely different from making slashing cuts when there are far better economic alternatives available.
It’s really bizarre that such a consensus about huge blanket cuts has been rigged up as though three crucial facts didn’t exist. One is that the government is spending £8-10bn keeping every million persons on the dole – that’s about £23.75bn a year keeping the present 2.64 million persons unemployed. That is not a sensible way of spending public money. The same amount of money, no borrowing, should be used to fund their employment building houses which are desperately needed, improving transport and energy infrastructure, and starting to build the green economy.
Second, the government is about to print another £75bn in so-called credit easing and giving it to the banks or big corporations. That is also not a good way of spending money when much of it, or even most of it, will end up in offshore speculation or tax havens. Far better for the government itself directly to use £20bn of that (or more) creating a million jobs in the priority sectors above.
Third, the 1,000 wealthiest super-rich (just 1,000 persons, only 0.003% of the population!) according to the Rich List have increased their wealth since 1997 by £296bn, enough to pay off the entire budget deficit twice over. How about a wealth tax on these lucky persons who’ve made such colossal gains at the expense of the rest of us, which could well raise £50bn over the next 5 years? A rather better way of conducting the public accounts than slashing the budgets for the NHS, schools and universities, housing, social welfare, and benefits for the disabled.