News that Merkel may well be about to exercise one of her skidding U-turns on growth doesn’t seem to have filtered through to our George. Even if he’s the last one in Europe, including dominatrix Merkel herself, to have accepted that austerity isn’t working and slumps require spending on jobs and growth, he’s not going to shift from his fixation with debt deflation.
But he is not the boy standing alone on the burning deck: he has plenty of other takers. Their local election drubbing seems to have redoubled the Tories’ ardour for ideological zealotry, with the Tory Right (and where they go, Cameron will soon follow) now hawking around their demands for even bigger public service and welfare cuts (when we haven’t even yet had 90% of the first tranche) which will reduce tax receipts still further and ratchet up the recession another notch. And they want too to ditch the human rights convention, bring back selective grammar schools, and heighten job insecurity. Bring it on!
Even in policy areas where Osborne’s boasted about his reforms, it’s all turned to dust. He claimed that through the Merlin negotiations he was increasing bank lending to industry; it is still falling. He claimed he was taking action to avoid another banking crash; but the new rules on capital ratios won’t come into operation till 2019. He claimed he found tax avoidance ‘morally repugnant’; but he hasn’t staunched the flow into tax havens – BIS data show bank accounts in tax havens still held £1,700bn in 2011, much the same as in 2007.
He has notoriously said (till recently) that ’We’re all in it together’. But last year average real UK incomes fell 1.6%, yet in the same year the wealth of the richest 1,000 Britons, according to the Sunday Times Rich List, rose £18bn – an average increase amounting to £346, 155 a week!
He has declared that executive pay increases have been excessive, but apart from wringing his hands has done nothing to stop it; it’s only shareholders and investors who’ve taken the action. He thought the 50p top tax rate cut would go down a blinder in Tory circles; even Tory voters according to the Mail on Sunday are now demanding its return.
This man has the touch of genius if the Tory aim is now, as it seems, to lose the next election.