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Friday, 15 June 2012

SO, WE'RE AGREED ABOUT THE CUTS THEN...



 Swansea South Wales Evening Post for June 13  carried an editorial which, in the context of cuts to the police, called for us to ‘accept as reality…substantial cuts in public spending,’ they were ‘inevitable’ and there could be ‘no ifs or buts about the need for cuts.’ What follows is the email I sent their letters page.

Your editorial on June 13th – ‘Cutbacks part of today’s reality’ – presented an opinion as if it were an objective fact. In fact ‘substantial cuts in public sector spending’ are NOT inevitable. You might have found one poll that thought this – there have been other polls that showed the opposite. Public sector cuts are being promoted by a certain sector of the political elite around the Cameron/Clegg coalition, and given full backing by the media.  This opinion has little resonance among the vast majority of public sector workers and union members, counted in the millions nationwide.

You would do well to remember that many of these live in Swansea. In fact, public sector workers represent a huge 31.76 % of the total workforce. The position of Swansea Trades Council is one of complete opposition to the cuts, as was that of the 2,000 people, both public and private sector workers, who marched through Swansea on 30th November last year. The ‘there is no alternative’ brigade pretends that what is really a set of political decisions is an inevitable fact. Many of us feel it is not an inevitable fact, and on 20 October we will be taking to the streets in our hundreds of thousands to join the Trades Union Congress march calling for a different economic strategy.

What would be an alternative? Well, the government could take its taxation of the rich and of the big companies seriously for a start. Although these are times of austerity for ordinary people, there seems to be no squeeze on the bosses of Britain’s biggest companies. Chief executives of FTSE 100 firms pocketed an average of £4.8 million each last year. More than a quarter of them took a pay rise of over 41 percent. Simply taxing at the levels Thatcher did in the 1980s would raise billions. Neither would this be electorally unpopular – the vast majority of people would like to see something done about the scandal of fat cat pay. In addition, the hugely expensive white elephant of Trident replacement could be abandoned, and the equally profligate, pointless and unpopular occupation of Afghanistan could be brought to an end as well. These swallow up billions each year.

The real problem at the moment is not the budget deficit. Britain had a much larger deficit at the end of the second world war and went on to build the NHS and the welfare state. The real problems globally are unemployment and lack of growth: this has been recognised by Obama in the US, and the recent elections in France and Greece reflect this. Increasing numbers of people doubt that austerity is working, or indeed can work. They fear that it will do just the opposite – it will destroy national economies.

In truth, as economists like Paul Krugman and commentators like the Guardian’s Larry Elliott will tell you, if you take an axe to the public sector you will deepen the recession. There is no Chinese Wall between the public and private sectors, especially after successive waves of privatisation. Cuts to the public sector are already having a chilling effect on the private sector. For example, education cuts mean schools abandon building programmes, which drives construction firms out of business and throws construction workers on the dole.

Then there is the effect on consumers and on tax revenues. In your editorial you point out the dangers of “tax revenues…falling at their fastest since 1923”. Exactly. What sort of impact will throwing millions of public sector workers out of work have?  Massive amounts of revenue will vanish to be replaced by greater payouts in unemployment benefit. Remember - the vast majority of UK cuts – 94% - are still to come. Is this a serious strategy  for achieving economic stability? Many see it as a suicidal programme which will put both the UK’s and the world economy into a ‘death spiral’ that will make the 1930s look like a tea party.

But of course none of this matters, because the Conservatives in the UK and the right-wing Republicans in the US have their own agenda. If you read Naomi Kline’s ‘The Shock Doctrine’ you will see how far-right economic fundamentalists have since the 1970s used successive economic crises to remodel society to benefit the rich and powerful. This is precisely what is happening now: Cameron and Osborne are intent on ‘shrinking the state’, getting rid of the NHS and handing the public sector over to their rich chums. That is why their plans make no economic sense. And that is why public sector cuts are not inevitable. 

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