Monday, 27 September 2021

Labour propose more austerity


The Labour leader’s lengthy essay has been widely attacked in Wales and Scotland for barely bothering to mention either country at all. It makes for good knock-about politics in Wales and Scotland, but it’s entirely to be expected from a politician who is increasingly turning into an English nationalist and wrapping himself in the union flag in an attempt to out-UKIP the Tory Party. Why wouldn’t someone like that instinctively believe that what’s good for England is good for England’s possessions as well?

The document has also been widely panned for being the vacuous cliché-ridden series of slogans which it undoubtedly is, but that unfairly gives the impression that it is somehow innocuous. It is not: in just a few choice phrases about ‘repairing the UK’s finances’, it reveals a continuing commitment to the misguided belief that the government’s finances are like those of a household, a commitment which necessarily implies both tax increases and spending cuts. It is, in short, a recipe for further austerity. As this article in yesterday’s Sunday Times makes clear (paywall), the Shadow Chancellor intends to set a wholly unnecessary ‘fiscal rule’ in order to deliver a balanced budget, something which only a combination of tax increases and spending cuts can deliver.

The problem with a slogan such as ‘repair the public finances’ is that it implies that those finances are currently ‘broken’ – after all, something which is working never needs repair. It might, though, need improvement so that it works better. And in the case of the public finances, there is certainly room for improvement in a tax/benefits/spending system which benefits the haves and punishes the have nots. Some of Labour’s more detailed proposals make sense in that context – for example, taxing extreme wealth in order to pursue a more distributive economic policy has a great deal to be said for it. It’s a proposal which can be justified on its own merits, however; it’s got nothing to do with repairing the public finances, and does not require a balanced budget.

The problem with Labour’s proposals the way they are currently being framed is that they effectively invite us to believe that Labour austerity is somehow better than Tory austerity, or that Labour will be better at delivering austerity. Those who seriously believe that austerity is necessary are unlikely to swallow either of those propositions; why wouldn’t they simply continue to vote for the real thing? The rest of us are left looking for an alternative view of how the economy should work and for whose benefit. Labour are very clearly telling us that, if that’s what we want, we shouldn’t be looking in their direction. That’s one thing at least that they’ve got right, albeit unintentionally.

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