27 Feb 2010

Bankers still in charge distract us with cuts agenda

Busting the straitjacket

Rolling back the new ‘common sense’ of spending cuts may seem like a difficult job, but it’s not impossible, says Mike Marqusee

It’s now clear that cuts in public spending, and resistance to them, will be the stand-out issue in domestic British politics during the coming years. The three major parties, the mass media (from the Mail to the Guardian, BBC to talk radio), think-tanks and pundits, not to mention the OECD, all insist that large-scale cuts must be made, that they are the only way to address the projected gap between state revenues and spending, and that this gap is the number one problem facing the British economy.

It’s been a remarkably deft manoeuvre. In less than a year, a system-challenging global financial crisis has been turned into a tussle over national bookkeeping. The problem has been redefined as an allegedly unsustainable public debt, rather than an economic recession brought on by demonstrably unsustainable private debt.

The ‘hole’ in the public finances that has occasioned so much hysteria is the result, not the cause, of the economic crisis. The public sector did not create the hole (that was the work of the banks) and it does not follow that cutting public spending is the way to fill it.

More here

There are, of course, savings that might be welcome but will not even be considered. Getting out of Afghanistan and Iraq, cancelling Trident, ditching ID cards, ending exorbitant payments to outside consultants, curtailing the number of people we imprison – all these together would go some way to reducing the deficit. Even more progress would be made by increasing taxation on corporate profits and individual wealth.

The fact that such options are being ignored suggests that closing the deficit is not quite the ineluctable, non-negotiable priority its proponents claim. The cuts policy is not a matter of economic necessity but of political choice – in this case, the wrong choice.

More here

1 comment:

DocRichard said...

Yes, and close the tax loopholes, shut down all tax havens.

And - dare I say it? - take the monopoly of creating money away from the big financial corporations. If 100% creation by the BoE is too radical, make it 50% created by the people - as low interest loans or grants for GND projects, and 50% created by banks as now.