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Wednesday, April 25, 2012

Austerity and the double dip

UK chancellor George Osborne is an economic simpleton,
a malicious ideologically driven neoliberal or most likely both.
On 25 April 2012 it was announced that the UK economy had fallen back into recession after suffering a 0.2% fall in GDP in the first quarter of 2012 which followed a 0.3% contraction in the last quarter of 2011. A technical recession is defined as two or more consecutive quarters of economic decline. These figures mean that the UK is suffering the first double-dip recession since the 1970s. The first recession between 2008 and 2009 was caused by the catastrophic meltdown of the deregulated financial sector. After hundreds of billions in bailouts, quantitative easing and secretive ultra-low interest central bank loans, the economy began to recover slightly at the tail end of Gordon Brown's government showing very weak economic growth figures, however the Tories have undermined the economic recovery in their ideologically driven rush to cut state spending.

The fact that the Tory led coalition has led the UK back into recession isn't simply a case of Tory incompetence, it is a demonstration of Tory malice. Instead of coming up with a credible recovery plan, they've gone full steam ahead implementing hard line ideologically driven neoliberal reforms under the guise of "austerity", telling us that the cuts are necessary because "the national credit card is maxed out" whilst simultaneously finding £40 billion to pour into the IMF neoliberal loan shark fund to force the same kind of destructive neoliberal policies onto other countries.

The neoliberal gibberish that underpins Tory thinking is defunct, it was holed beneath the water line when the "evil state sector" had to bail out the financial sector temples of neoliberalism with the biggest subsidies in human history (the Tory supported nationalisation of debt riddled banks and 90%+ of GDP blasted in massive bailouts that are still misleadingly kept hidden away off the national debt figures) yet the Tories continue hawking exactly the same ideologically driven neoliberal clap-trap under the new name of "austerity".

Neoliberal policies such as deregulation of the financial sector and hiving off the responsibilities of the state to "extremely inefficient" (according to the treasury select committee) PFI ripoffs, crappy outsourcing deals to enrich their mates, massively subsidised and inefficient monopolies like the rail shambles and insane privatisations like selling off HMRC properties to a bunch of tax dodgers are what created the neoliberal economic meltdown and the budget deficit in the first place, but all the Tories have offered since the meltdown is more of the same ideologically driven gibberish under the new name of "austerity" whilst lying through their teeth that the crisis was caused by excessive state spending.

Andrew Lansley's NHS sell-off doesn't have any economic merit,
unless you consider diverting taxpayers' cash to parasitic private
sector health care corporations to be economically beneficial.
Their self defeating austerity drive has absolutely nothing to do with saving the economy, it is all about attacking the state from within in order to cream off even more taxpayers' cash directly into the pockets of their private sector mates and financial contributors, destroying the social safety net (attacks on health care, unemployment benefits, disability benefits, pensions, social services, legal aid, police numbers....) and wreaking as much havoc as they can in deprived traditionally Labour voting areas with their insane "regional pay schemes" which are exactly the opposite of what is needed, namely better pay and conditions as incentives for talented people to go and improve services in deprived areas.

The Tories have driven the UK back into recession by trying to use neoliberal economic dogma to cure an economic crisis which was caused by three decades of neoliberal dogma. A neoliberalisation process started by Thatcher's Tories and continued under 13 years of neo-Labour rule. The economic crisis was caused by an overdose of toxic neoliberal medicine, yet the Tories have spent the last two years prescribing greater quantities than ever of their economic arsenic quack medicine.

The fact that the Tories have stuck rigidly to their defunct neoliberal principles shows us one of two things: They either meet Einsteins definition of insanity (doing the same thing over and over again and expecting different results) or their agenda had nothing to do with economic recovery in the first place and that they are simply interested in further enriching the already wealthy at the expense of everyone else in complience with their unofficial party motto of  "steal from the poor to give to the rich".



See also





5 comments:

Sheffpixie said...

Hi Tom

Pretty much agree with everything you said. But what are we going to do about it? I posted a link to a Zizek critique of Occupy on yesterdays UT thread which is worth a read.

I'm pretty much a brain dead old bag these days and looking for inspiration about how to move from where we are to something that resembles a socially just society. Got any ideas?

Sheffpixie said...

....I meant to add, move from where we are now without excessive amounts of blood in the streets....

Thomas G. Clark said...

Hi Sheffpixie,

I'm not sure we should spend too long trying to re-invent the wheel with a sparkling new socio-economic policy while the neoliberal brigage continue destroying the state from the inside.

We should look at fanctional models.

The Nordic Model seems to be weathering the neoliberal economic crisis.

The Argentine recovery plan (infrastructure spending, investment in education and welfare, taxes on capital flight and selective renationalisations) has done wonders since they emerged from their economic crisis.

Or we could revert to the last functional economic model, the social democratic mixed economy, which despite it's flaws managed to reduce the national debt from 243% of GDP down to 43% and keep anyone that wanted it in work. They don't call it "the golden age of capitalism" for nothing.

it's either something nordic, popular socialist or mixed economy based or blood on the streets. I imagine the neoliberal brigade wouldn't mind blood on the streets if it meant that their privatised police forces could gun us down with impunity.

Sheffpixie said...

Of the three you suggest I think the Nordic model might be a place to start. But persuading the ordinary British public, never mind the wealthy elites to pay the requisite taxes would be quite a job.

There'd also have to be a complete re-think about how we educate and train our citizens - i.e. much more emphasis on social responsibility, notions of solidarity and communality etc. With a population that has been spoon fed individualism and consumerism for the past 30 years this will take time to feed through. Even if there was a real commitment to this we'd be in for a really bumpy ride, but worth it if we could keep the inevitable mayhem to a minimum.

Leni said...

Hi Tom + Sheff

In total agreement - can only add I am trying to find the very first positive step towards change.

There are alternative models out there - it is the getting there. Lots of theories, different solutions on offer but no practical plan or guide.

Every map I look at has large empty spaces with 'Here be Dragons' warnings.

Nothing will change without confrontation because there is no mechanism for change in the system.