Thursday, 29 March 2012

Liberal-Tory Incompetence

Campo, Foggy Osborne, and Clegg
It comes to something when even the Capitalist media spend more than a week with headlines attacking the Liberal-Tory Government. But, that is what we have seen. Its an indication of a feature of the Liberal-Tories I've pointed out before – their seeming sheer incompetence, and political ineptness. Over the last few weeks, we have had “Horsegate”, “Dinnergate”, “Grannygate”, and now “Jerrygate”, and “Pastygate”! Of course, that comes on top of the Tories association with various characters of interest to the Police in their investigations over “Hackgate”. Then there have been the travails of the Liberals, which caused David Laws to step down within days of taking office. That is the least of the Liberals problems, however, as their voter and membership base disappears into the air, as the Liberal leadership become more and more indistinguishable from the Tories – witness the terrible attempt of Liberal Energy Minister, Ed Davey, this morning, on TV, to blame the tanker drivers for the Government's incompetence, by saying responsibility lies for a strike, which has not yet even happened! All Government's eventually pile up a number of calamities, over the years, but this Government, has piled them up from Day One. No wonder, even Chris Huhne's supporters called the Deputy Prime Minister, “Calamity Clegg”.

The Liberal-Tory incompetence began even before they were elected. The Liberals had gone into the election sharing Labour's position that any attempt to withdraw the fiscal stimulus, before the recovery had properly taken hold, would be folly. Of course, less than a year earlier, David Cameron and the Tories had been saying the same thing, promising to even outspend Labour, on a range of services! But, the Republicans, in the US, had undermined the position of the Democrats, in Congress, by attacking the kind of fiscal stimulus policies that they had been carrying out, under Bush, and which Obama was continuing. The Tories, like good opportunist politicians, saw the possibility to pull off the same trick. They abandoned their previous position, and adopted a position similar to the “Tea Party Taliban”, in the US. Both appealed to a right-wing populist constituency that forms the core of Conservative support. So, they ridiculously came out with statements which equated Britain with bankrupt Greece. The Liberals, before the election, opposed this nonsense, and according to an interview David Laws gave to Sky News, even during the Coalition negotiations, the Liberals held to that position. He talked about the issue of the deficit being “hyped up”.

But, with the sniff of the leather of a Ministerial limousine, the Liberals quickly dropped their opposition to this economic illiteracy, and fell into line, to insist that the country was about to go bankrupt unless the most severe austerity measures were introduced. See: Liberal Economy With The Truth. This then provided the narrative for the Liberal-Tories to distinguish themselves from Labour. In every subsequent interview, the Liberal-Tories parroted the mantra, “Its all the fault of Labour's extravagant spending. The country was about to go bankrupt. The fiscal austerity has reduced our interest rates. There is no alternative.” But, that is all it was, a narrative, it had no basis in reality.

The UK clearly was not Greece. The country was not about to go bankrupt, or anything like it. There had been no extravagant Labour spending. In fact, the average percentage deficit under Blair and Brown was significantly lower than under Thatcher and Major. Interest rates were not particularly high. There was no chance that Bond Markets would stop lending to Britain. Interest rates have not fallen due to the austerity measures, but because the Bank of England has printed billions of pounds, and used it to buy UK Gilts! The same process has caused the pound to fall, and inflation to soar. It has also caused “Financial Repression”, in other words, pensioners and other savers find that the interest they receive is significantly below inflation, causing them to lose money. There clearly was an alternative. The austerity has caused the economy to tank, worsening the Government's financial position, and the ability to repay the debt. The US, which continued to apply measures of fiscal stimulus, has continued to recover, with unemployment beginning to fall significantly.

The narrative adopted by the Liberal-Tories might have been politically convenient, but from the beginning it shot them in the foot. See: Victims Of Their Own Incompetence. Once locked into this narrative, they were unable to get out of it without causing a crisis of confidence, and undermining their only response to attacks by Labour. But, it was that narrative that forced the Liberals to accept the increase in Tuition Fees, for example. They cannot openly change course significantly, because that would be political suicide. But, of course, they have already changed course. That is illustrated by the fact that only around 6% of the austerity programme has so far been introduced. They have been forced to modify some of their welfare measures, though welfare continues to bear the brunt of the cuts, and they have been forced to introduce some changes to Capital investment programmes, in response to complaints by Capitalists as the economy tanks.

Michael Gove's Alter Ego - Pob
But, that again showed the incompetence of the Liberal-Tories. The first programmes to get hit were Capital projects that were important for business. The “Building Schools For The Future” programme was the first, which hit not just construction companies and their suppliers, but the IT companies who would be providing the technology for those schools. It was no surprise that the announcement of this, by Michael Gove, was itself a catalogue of errors. The Liberal-Tories were undertaking this programme, whilst at the same time attacking the very State bureaucrats they needed to support them in the plan! See: A Bit Of A Pickle.

The Liberal-Tories have appealed to a right-wing populist constituency that makes up the core of their membership and voter base. That is more true of the Tories than the Liberals. The Liberals also have that base, but in the past, they were also able, by being two-faced, to appeal in parts of the country, to a different constituency, the petit-bourgeois intellectuals, the Guardianistas. In order to get their hands on the Ministerial limos, they have been prepared to ditch that base, and throw in their lot with the Tories. There is probably no way back for them from that position. That is why the Liberal-Tories have adjusted their appeal accordingly, to focus on that constituency. It is why, in the Budget, they were prepared to introduce the “Granny tax” in order to pay for the cut in the 50p tax rate. It is why they made some adjustments in their plans to remove Child Benefit from high rate tax payers. But, even here, they seem to be incompetent.

Its obvious why an appeal to high rate taxpayers, earning over £150,000 a year based on cutting taxes might be popular. But, of course, not all these people are the same. A relatively successful small capitalist might earn £100-150,000, and might well welcome the tax cut. On the other hand, given that the other side of the tax cut is the austerity, then if that small capitalist, say, supplies schools with materials, they may not at all see such a trade off as worthwhile, if it sends their business into bankruptcy, for lack of orders from schools. And, of course, the Local Government or Civil Service Department Head, or the Headmaster of a Medium sized school earning that amount will have a different view, because their salary and position itself depends on the continuation of the empire beneath them. One or two might welcome the cuts, if they were looking to take early retirement, but that will not apply in general.

If you are going to launch the kind of class war that the Liberal-Tories have embarked upon, itself a farcical repetition of Thatcherism, as I set out in History Repeating As Farce, then you should at least ensure that the forces of the class camp in which you are fighting, are securely lined up behind you. The Liberal-Tories have not even been able to do that, which is why we have seen more than a week of headlines attacking their incompetence.

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