Sunday, 18 October 2015

Abysmal Tories Run From The Truth

Last week's debate on the Charter for Fiscal Responsibility, showed just how abysmal the Tories are.

Firstly, the debate itself was recognised by everyone and their dog as being nothing more than a stunt. What impression in itself does that give, when the government of the day is prepared to waste time and money using Parliamentary time just for that purpose? At least the Tories only allocated ninety minutes for the debate, but that in itself simply emphasised that there was no intention to have any kind of meaningful discussion of issues, and that it was indeed just a political stunt put on by Osbourne.

This political stunt was supposed to be a trap for Labour, but the fact that everyone on the planet understood it to be such a trap, and a political stunt, meant that it could, in reality, be no such trap. If everyone understands it to be a stunt, to set a trap of the “have you stopped beating your wife” variety, whereby if Labour voted for it, it would mean tying themselves into being seen to be supporting the Tories, whereas if they voted against, the Tories would accuse them of being deficit deniers, then it can no longer be a trap.

That was the basis on which John McDonnell had, more than two weeks ago, set out his tactical reason for simply mocking the Tories political games, whilst voting for what is in reality a meaningless charter, that Osbourne himself is already in breach of. As McDonnell said in the debate, his decision to change those tactics, and to vote against the Tories proposals was embarrassing, but, nothing more.

In fact, had Labour simply voted against the Tories proposals from the beginning, the Tories would then have gone all out in attacking Labour as being deficit deniers, but now, they can hardly do that, because the focus on the nature of the debate, over the last two weeks, has laid bare the nature of Osbourne's charter, as merely a political stunt. In fact, what it has done, is to highlight the fact that Labour, now, has clear alternatives both to the idea of simply borrowing to sustain a deficit, and to austerity.

The advantages of this may not be apparent, in the short term, as the focus is on the embarrassment of the change of tactics, but the longer-term advantages that flow from it are greater. A start in that regard came in the actual debate, such as it was, on the charter itself. Many of the Blair-rights stayed away, and abstained rather than vote against the Tories, because they themselves are tainted with austerity politics, and themselves failed to demolish, in 2010 and after, the Tory myth about Labour profligacy, but the Labour MP's who did turn up to oppose the Tories, and their austerity economics, were able to not only highlight the ludicrous nature of the charter, and the fact that the Tories are in breach of it, but also to undermine the lie, which is the basis of the Tories narrative.

The fact is that Osbourne has put forward this charter on the pretence that it commits future governments to running a budget surplus in “normal” times. But, the UK is currently in “normal” times. On the basis of official statistics, unemployment is falling, employment and wages are rising, and the economy is growing at around 2.5% a year. Yet, the Tories are running a large budget deficit, not a surplus. In fact, with the trade deficit growing ever wider, with the NHS requiring additional funding, to cover its own widening deficit, and so on, the government deficit looks set to widen further.

Moreover, given current conditions, of interest rates at 300 year lows, now would be precisely the time for a sensible government, to lock in that advantage by massively increasing its issuance of long term debt, so as to retire some of its existing, higher cost, shorter term debt. Now is precisely the time, to use such low-cost borrowing to fix the roof, by using the funds to invest on a large scale in all of those elements of the country's infrastructure that are required to create a modern, more efficient, more productive, and more profitable economy. Yet, Osbourne's charter cuts off that possibility!

Fortunately, the other reason the charter is a nonsense is that a future government can simply repeal it, should they feel the necessity, rather than just ignoring its requirements, as Osbourne and the Tories are currently doing.

In the debate, the abysmal nature of the Tories was shown by the contributions of their MP's. McDonell was led to apologise to one Tory MP, for being “a bit harsh”, and to another female Tory MP, for not being “gallant” in his response, but he was more than justified in his original comments to them. At Prime Minister's Questions, over the last five years, Cameron has become infamous for failing to answer any questions, and instead simply using the time to crack jokes, and go off on long prescripted rambles. The Tory MP's, during the debate, followed the same mindless approach.

Three Tory MP's, one after the other, intervened in McDonnell's speech, not to say anything sensible, but to ask exactly the same, obviously prescripted question, about what had changed in the last two weeks to cause McDonnell to change his mind in calling for a vote against, rather than for, the proposals. McDonnell had actually begun his speech by setting that out. Having done so, he still responded to the first intervention, but its understandable why, when the second Tory MP, asked the self same question, McDonnell responded by saying that it was a good idea before making such an intervention to have listened to the debate that had already taken place, and why when the third asked exactly the same question, he responded by saying “Do try to keep up.”

But, a look around the Tory benches seemed to show why their speeches were so abysmal. Many look like kids just out of Public School, let alone Oxbridge, the others look like careerists who are incapable of a single original thought of their own, and so simply churn out the pre-scripted material drafted for them by Tory HQ, or else limit themselves to simply parroting well worn mantras. When they are themselves challenged on those mantras, they are flummoxed, and like Cameron, unable to actually comprehend that these mantras have no substance, and so are unable to answer the question put to them.

So, one MP reeled off the usual nonsense about Labour profligacy causing the global financial crash. He clearly did not have a clue what he was talking about, and so when one Labour/Co-op MP put it to him, that wasn't he then also criticising Maggie Thatcher, because she had run fewer budget surpluses than Labour, had run deficits when the economy was growing, and had run a deficit to GDP ratio twice what it had been under Labour, this didn't compute with him at all. His only response was to bluster, “I'm not going to dignify that with a response.”
But, the facts are clear.  Despite having the advantages of North Sea Oil, despite the savage attacks on wages and the fabric of society that Thatcher and Major undertook over eighteen years, the Tories during all that time ran budget deficits in all but two years!  Even when they ran surpluses, they were small, and mostly due to receipts from selling off the family silver through the privatisation of state assets.  By contrast, despite the global economic crisis that erupted from the collapse of the Asian currencies and then the Rouble, followed by the collapse of Long Term Capital Management in the US, and the 75% drop in the NASDAQ, Labour ran budget surpluses in its first four years.  Even when Labour spending on infrastructure to actually fix the roof on all of the schools, hospitals and other buildings that the Tories had allowed to rot, this increased spending was matched by rising growth.  The result was that during all that time, the ratio of the deficit to GDP, was less than half what it had been under Thatcher and Major.  Even if we take in the increased spending that resulted from the global financial crash, the average for the entire period under Labour rises to only just over two-thirds of what the ratio had been under the previous Tory governments.

In fact, John Mann had pointed out that fact, earlier, and in a bewildering response, Ken Clarke even claimed that Labour had allowed the dotcom bubble to continue in 2000. As though a stock market bubble centred on the United States, was any more capable of being controlled by Gordon Brown, than was the US sub-prime crisis, a few years later!

The fact is that, the Tories whole case has been built upon a lie. It is the lie of Labour profligacy. But, as the charts show, it is under the Tories that the UK's debt to GDP ratio has soared. What is more despite Osbourne's gimmick of the Charter of Fiscal Responsibility it is set to soar even higher in coming years.

What is more the basis of that debt has not come from labour profligacy in previous years. As the charts also show, it was under Thatcher and Major, not under Blair and Brown, that the UK's deficit expanded, despite the austerity and wage cuts that the Tories introduced.

They and their Liberal accomplices got away with running away from that truth over the last five years, because the Blair-rights dominating the party failed to address it, for their own narrow reasons. But, now the Labour Party should shout it from the rooftops.

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