Fingers crossed that we can move forward.
The campaign is nearly over and it is time to choose. We believe Britain needs a new direction. At home, the economic recovery is only fragile, while social cohesion is threatened by the unequal impact of the financial crisis and the continuing attempt to shrink the postwar state. Abroad, Britain remains traumatised by its wars, and, like our neighbours, is spooked by Vladimir Putin, the rise of jihadist terrorism and by mounting migratory pressures. In parts of Britain, nationalist and religious identities are threatening older solidarities, while privacy and freedom sometimes feel under siege, even as we mark 800 years since Magna Carta. More people in Britain are leading longer, healthier and more satisfying lives than ever before – yet too many of those lives feel stressed in ways to which politics struggles to respond, much less to shape.
This is the context in which we must judge the record of the outgoing coalition and the choices on offer to voters on 7 May. Five years ago, Labour was exhausted and conflicted, amid disenchantment over war, recession and Gordon Brown’s leadership. The country was ready for a change, one we hoped would see a greatly strengthened Liberal Democrat presence in parliament combine with the core Labour tradition to reform politics after the expenses scandal. That did not happen. Instead the Conservatives and the Liberal Democrats have governed together for five difficult years.
That experiment has clearly run its course. The outgoing government proved that coalitions can function, which is important, and it can be proud of its achievements on equal marriage and foreign aid. But its record, as our recent series of editorials on detailed themes has shown, is dominated by an initial decision to pursue a needless and disastrous fiscal rigidity. That turned into a moral failure, by insisting on making the neediest and the least secure pay the highest price for an economic and financial crash that they did not cause. The evidence is there in the one million annual visits to foodbanks, a shocking figure in what is, still, a wealthy country.
David Cameron has been an increasingly weak prime minister. On issues such as Europe, the integrity of the United Kingdom, climate change, human rights and the spread of the low-wage economy, he has been content to lead the Tories back towards their nastiest and most Thatcherite comfort zones. All this is particularly disappointing after the promise of change that Mr Cameron once embodied.
The union at risk
The Conservative campaign has redoubled all this. Economically, the party offers more of the same, prioritising public-sector austerity which will worsen life for the most needy – imposing £12bn of largely unspecified welfare cuts – while doing little to ensure the rich and comfortable pay a fair share. Internationally, the party is set on a referendum over Europe which many of its activists hope will end in UK withdrawal. It’s also set on an isolationist abandonment of British commitment to international human rights conventions and norms, outcomes which this newspaper – unlike most others – will always do all in its power to oppose. At the same time, the Tories go out of their way to alienate Scotland and put the UK at risk. The two are related: if a 2017 referendum did result in a British exit from the EU, it could trigger a fresh and powerful demand for a Scottish exit from the UK. The Conservative campaign has been one of the tawdriest in decades.
The overriding priority on 7 May is therefore, first, to stop the Conservatives from returning to government and, second, to put a viable alternative in their place. For many decades, this newspaper’s guiding star has been the formulation offered by John Maynard Keynes in a speech in Manchester in 1926: “The political problem of mankind is to combine three things: economic efficiency, social justice and individual liberty.” The task on 7 May is to elect the parliament and government that will come closest to passing Keynes’s triple test.
Some despair of the whole system, believing a model created for two-party politics is now exhausted, failing to give adequate expression to the diverse society we have become. We are hardly newcomers to that view: we have demanded electoral reform for a century and believe that demand will find new vigour on 8 May. But for now, this is the voting system we’ve got. How should we use it?
To the charge that they enabled a government whose record we reject, the Liberal Democrats would plead that they made a difference, mitigating and blocking on issues such as Europe, the environment, child benefit and human rights, without which things would have been worse. That adds weight to the view that the next Commons would be enhanced by the presence of Lib Dem MPs to insist on the political reform and civil liberties agendas – as they did, almost alone, over Edward Snowden’s revelations. Similarly, it would be good to hear Green voices in Westminster to press further on climate change and sustainability. Where the real constituency choice is between these parties and the Conservatives, as it is between the Lib Dems and the Tories in the south-west, we support a vote for them. But they are not the answer.
In Scotland, politics is going through a cultural revolution. The energy and engagement on show are formidable – and welcome. The level of registration is an example to the rest of Britain. If the polls are right, and the SNP is returned as Scotland’s majority party, we must respect that choice – and would expect all parties that believe in the union, and the equal legitimacy of all its citizens, to do the same. We do that even as we maintain our view that, whatever myriad problems the peoples of these islands face, the solution is not nationalism. Breaking apart is not the answer: not in Europe and not in the UK. We still believe that the union rests on something precious – the social and economic solidarity of four distinct nations – and that is to be nurtured and strengthened, not turned against itself.
A sense of what is just
Which brings us to Labour. There have been times when a Labour vote has been, at best, a pragmatic choice – something to be undertaken without enthusiasm. This is not such a time. Of course there are misgivings. The party has some bad instincts – on civil liberties, penal policy and on Trident, about which it is too inflexible. Questions linger over Ed Miliband’s leadership, and whether he has that elusive quality that inspires others to follow.
But Mr Miliband has grown in this campaign. He may not have stardust or TV-ready charisma, but those are qualities that can be overvalued. He has resilience and, above all, a strong sense of what is just. Mr Miliband understood early one of the central questions of the age: inequality. While most Tories shrug at that yawning gap between rich and poor, Labour will at least strive to slow and even reverse the three-decade march towards an obscenely unequal society. It is Labour that speaks with more urgency than its rivals on social justice, standing up to predatory capitalism, on investment for growth, on reforming and strengthening the public realm, Britain’s place in Europe and international development – and which has a record in government that it can be more proud of than it sometimes lets on.
In each area, Labour could go further and be bolder. But the contrast between them and the Conservatives is sharp. While Labour would repeal the bedroom tax, the Tories are set on those £12bn of cuts to social security, cuts that will have a concrete and painful impact on real lives. Even if they don’t affect you, they will affect your disabled neighbour, reliant on a vital service that suddenly gets slashed, or the woman down the street, already working an exhausting double shift and still not able to feed her children without the help of benefits that are about to be squeezed yet further. For those people, and for many others, a Labour government can make a very big difference.
This newspaper has never been a cheerleader for the Labour party. We are not now. But our view is clear. Labour provides the best hope for starting to tackle the turbulent issues facing us. On 7 May, as this country makes a profound decision about its future, we hope Britain turns to Labour.
guardian.co.uk © Guardian News & Media Limited 2010
We all know this to be true, but nobody is going to do anything about it so it will only get worse as time passes.
“There is no alternative.” It is the slogan, battle cry and sneer of our era. It is ever present in this general election, like a police sentinel guarding a sacred political consensus, batoning anyone who deviates from received wisdom. The fortunes of Britain’s richest 1,000 can double in a period of economic trauma while hundreds of thousands depend on charities to meet that most basic human need, food. A proposed mansion tax levied on a tiny fraction of the population is met with accusations of cruelty while predominantly poor disabled Britons are compelled to shell out money they don’t have because they are deemed to have a spare bedroom, all in order to balance the nation’s books. More than 400 people can be paid over £1m at one business alone, Barclays Bank, when the whole country of Japan has fewer than 300 executives paid that amount. Why? Because there is no alternative: either policies are pursued that guarantee the concentration of wealth and power in the bank accounts of a tiny elite, or the rich will flee and the economy will collapse.
Britain’s booming elite is soaked with triumphalism. It believes its traditional enemies – principally a trade union movement and political left with a coherent ideology and mass following – have been seen off. This elite is flattered, comforted and protected by an ideology that equates the perpetual enrichment of the wealthy with the wellbeing of the nation, promoted by a media owned by its own kind, an academy largely emptied of intellectual dissidents, and a network of thinktanks kept afloat by corporate and well-to-do private individuals. Any puncture, however small, to this suffocating triumphalism is welcome: to those of us who reject the status quo, it is like coming up for air.
Professor Anthony Atkinson is a pioneer of the study of the economics of poverty and inequality. His latest work, Inequality: What can be done?, is an uncomfortable affront to our reigning triumphalists. His premise is straightforward: inequality is not unavoidable, a fact of life like the weather, but the product of conscious human behaviour. The explosion of inequality as a result of intentional policy decisions has been rather spectacular. Take the US, which became steadily more equal from the end of the second world war to the late 1970s. By 2012, the top 1% had more than doubled the share of national income they enjoyed in 1979, and now receive a fifth of gross US income.
In our own country, the share of gross income belonging to the richest 1% after the first world war was 19%; it had fallen to 6% by 1979, and has since more than doubled. Inequality actually rose twice as much in Thatcher’s Britain as it did in the US, albeit from a significantly lower base.
Atkinson identifies the usual culprits: globalisation, in which the wealthy can easily pick and choose nations most favourable to their bank balances; rapid technological change, which has stripped away middle-income secure jobs; the explosion of a rapacious financial sector; a shift in attitude to high pay; the hobbling of trade unions, once a formidable counterweight to wealth being sucked to the top; and the erosion of redistribution based on progressive taxation.
It doesn’t have to be like this. Take the explosion in technology. In Britain, we’ve seen the rise of an “hourglass economy”, with professional middle-class jobs at the top (often reserved for the pampered through unpaid internships and expensive post-graduate qualifications) and insecure, low-paid service-sector jobs at the bottom. Many middle-income skilled jobs have been lost, often on the basis that machines can perform such labour more cheaply and efficiently. A recent study suggested that 10m jobs, or a third of all those in Britain, could be wiped out because of new technology and computers.
But Atkinson refutes the idea that technological change is “determined by the gods”: it is the result of decisions taken by scientists, investors, governments, consumers and others. Much of research and development happens in the public sector, as the economist Mariana Mazzucato has underlined in her book The Entrepreneurial State. If you’re reading this column on an iPhone, thank the state for its touchscreen technology, GPS and Siri. So why doesn’t the state take more of an active role in directing technological change so it benefits all? Look at Germany, which rather than opting for a hands-off approach promoted renewable energy industries, both confronting the climate change crisis and avoiding the rotting away of decent jobs seen in this country.
Some of Atkinson’s proposals are heresy in an era like our own. He suggests raising the top rate of tax to 65% – casting a cynical eye over studies that claim this is counterproductive when it comes to revenues – and calls wisely for proper crackdowns on tax avoidance. Partly it comes down to fairness for the professor: the government’s universal credit scheme aims to cut the marginal tax rate on the poor to 65%. If that’s good enough for those scraping by, why not for those richer than ever before?
In other European countries, it is taken as read that trade unions have a role in drafting social security legislation – why not here too? Another radical but attractive proposal is to grant all citizens an inheritance payment on reaching adulthood, funded by a 2% tax on personal wealth. With the return to precarious employment, the state could guarantee work, with a minimum wage that actually meets people’s living costs. A maximum pay ratio in businesses would stop shamelessly self-interested CEOs paying limitless salaries and bonuses while their cleaners languish on poverty wages.
These are the sort of proposals that are banished from the media-defined mainstream of the election debate. The parameters of acceptable political conversation are, after all, heavily policed: even a modest challenge to continually stuffing the mouths of the richest with gold is ignored, ridiculed or demonised.
We need a whole new way of thinking. The nation’s wealth is not the product of the genius of a few canny entrepreneurs. It is a collective endeavour, the product of the labour of millions and the support of the state. The hospital cleaner, the road-builder, the teacher training up both workers and the entrepreneurs of the future: all help generate wealth. The state builds and maintains the infrastructure, funds the research, educates the nation, protects property and tops up low wages. So much of our collectively produced wealth should not be locked away in a few bank accounts. The triumphalists will tell us that there is no other way. They are wrong, and it’s about time we called their bluff.
guardian.co.uk © Guardian News & Media Limited 2010
I think we have been desensitised as a nation or is it perhaps just good old fashioned brain washing? Whilst we continue to demonise people for what is often essentially bad luck like illness infirmity, sudden redundancy’s that leave people long term unemployed.
Why also is there so much stress on work above everything else? We work to live rather than live to work unless we are lucky enough to have a vocation of course. The fallacy that can all work our way out of any hardships is simply not the case. the universe doesn’t do equal opportunities, but we as human beings can control some aspects and even things up.
It was the raw early days of the coalition, and one of David Cameron’s lieutenants was giving a frank answer to my blunt question: what would it take for the government to pull back on its planned cuts? You didn’t need a Mensa membership to see that this topic would define the next five years.
On that sunny autumn afternoon, the newspapers were full of students besieging Conservative central office, but Cameron’s aide coolly judged that they’d blown it by picking the wrong target. Had they swarmed on Lib Dem HQ “that would really have put Clegg under pressure”. So what would change Tory minds? “The crunch will come when the Mail puts on its front page pictures of some Iraq war veteran in a wheelchair who’s lost his disability benefits.”
That ugly logic has underpinned this government. Cameron and Nick Clegg have justified social security cuts by reciting a litany of false oppositions. Strivers v skivers. Workers v shirkers. The bedroom tax, the arbitrary removal of benefits from those infringing some bureaucratic small print, the judging of sick people as fit for work – £17bn of cutbacks have been sold by ministers, and bought by the public, as falling on the undeserving poor: the mickey-takers on a gigantic, taxpayer-funded bed-in.
What my contact foresaw back in 2010 was that if this political link were ever broken, and money seen to be taken from the plainly deserving, the central plank of austerity would snap in two. However, that Mail front page has never appeared, and yesterday Cameron was able to warn of Labour “chaos … higher taxes for every working family to pay for more welfare”. Even so, the Law of Welfare Cuts has just taken two shattering blows.
The first was delivered by the Conservatives themselves, in the form of a leaked paper discussing options to make more benefit cuts. Commissioned by the Tories, written up by senior civil servants and already under discussion by ministers, the proposals include taking allowances from about 40% of carers for the sick; the scrapping of government compensation for those who’ve suffered industrial injuries; and the taxing of disability benefits.
The Conservatives have tried to stamp all over this story, and with excellent reason. Where’s the justice in taking cash off someone who’s mangled an arm on a construction site, or who’s had to cut back on work to look after a sick child? These savings manifestly break the coalition law of welfare cuts: that they must be seen to be fair.
And they don’t even save that much money. As with so many “reforms” since 2010, these reductions would turn people’s lives upside down, plunge some into debt and tear families apart – and in some cases raise little more than loose change. It may be that we have passed the high tide of public support for cuts in social security – and it would be for exactly the reason predicted by that Conservative aide in 2010. The Tories have set a goal of cutting another £12bn a year from welfare by April 2017. This target is so stupidly implausible that it will force any future government led by Cameron into ever more manifestly unjust benefit cuts. That fictional divide between deserving and undeserving poor may be on the verge of collapse.
How much of a fiction that divide really is can be seen in a new report published by academics at the LSE. Is Welfare Reform Working? is based on two rounds of interviews, first in 2013 and again in 2014, with 200 people who live in the south-west of England, from Plymouth to Bath to just outside Chippenham – where Cameron launched his election campaign yesterday.
In my years writing on this subject, I have read scores of reports and books on welfare reform – but I’ve never seen anything like this. Here are hundreds of people, all living at the sharp end of austerity. Every interviewee is a social-housing tenant of working age, which makes them the number one target of this government. Last September Iain Duncan Smith, in an interview with the Express headlined “We are breaking up Shameless housing estates”, boasted: “We’re making real progress into that stubborn part of the out-of-work group who are in housing estates …” The work and pensions secretary was talking about exactly the LSE interviewees – and this report allows them the right of reply: the LSE authors let their subjects do the talking.
The first thing to come screaming out of the report is how many of the interviewees didn’t plan to be out of work. They’ve got a disability, or they were caring for children or a sick parent, or they were just laid off. You meet Mrs Spencer, who spent seven years out of the jobs market to nurse her daughter through cancer. The daughter died two months ago and the last of their savings went on her funeral. Now her husband has been made redundant after 27 years of work. He’s 59 and has only one eye.
Well over half the respondents claim to be coping. This sounds like good news – until you discover what they mean by that. Getting by means falling behind on rent or into debt; managing means eating less or going without heat. “I’ve got a dog and I’ve got to make sure he’s OK,” one says cheerfully. “If need be I’ll eat his biscuits.”
Re-read that sentence, remembering that you and he live in one of the richest societies on the planet.
How has the government helped? The bedroom tax “is a tax on my disability”, according to one interviewee who used his second bedroom to take oxygen. Respondents hate the jobcentre, which just holds up ever higher hoops to jump through – or else it sanctions them. Another interviewee tells of how his sanction meant that he lost his home, and now sleeps on a sister’s couch.
These people represent a society that has been cut adrift by politicians of all parties: a society that will go unaddressed by the election campaign, and uncourted by any major party. And yet these people talk just like you and me; they just have worse stories to tell.
In that same Express interview, Duncan Smith claimed that he had moved the Shameless estate-dwellers from a “dependency culture” to independence. Here is a different version of events from one of the LSE interviewees: “My best friend committed suicide in March – she went through … relentless reassessments, and found the forms very confusing. She was disabled but they were questioning her over and over again. DWP hounded her for information. It’s a horrible feeling, knowing that your friend was pushed over the edge like that. I’m pretty certain that if these welfare reform changes weren’t going on, I’d still have her with me.”
guardian.co.uk © Guardian News & Media Limited 2010
Economic miracle. No I don’t think so somehow. There might be some trouble brewing don’t you know.
George Osborne styled Britain as the “comeback country” in Wednesday’s budget. Yet the carefully crafted narrative, in which he plays the sombre statesman stewarding the economy back to calmer waters, barely disguises the nakedly political nature of many of his decisions — and the serious risks that remain.
First, Osborne has only been able to cut debt as a share of GDP this year – hitting a target he was expected to miss as recently as December – and promise to call a halt to austerity before the end of the next parliament, as a result of a two-stage act of political conjuring.
Instead of the five-year austerity drive he pencilled in as recently as December, he has now set public spending on what the independent Office for Budget Responsibility (OBR) called a “rollercoaster”.
The Treasury will now swing the axe more sharply than previously planned in 2016-17 and 2017-18, before switching back to deliver what the OBR calls “the biggest increase in real spending for a decade in 2019-20”.
It’s a boom-bust spending pattern for public services no Whitehall mandarin would deliberately plan — but it will help Osborne to ward off the accusation that he is on an ideological crusade to shrink the size of the state.
Second, the chancellor is counting on the proceeds of a pair of banking privatisations. He has announced plans to sell off a mountain of mortgages the government has owned since the bank bailouts, and a fresh batch of Lloyds Bank shares.
The handy £20bn proceeds – which, conveniently, he plans to pocket by the end of 2015 – will make no difference to the size of the public debt in the long term, because the state is losing out on the mortgage repayments and dividend income it would otherwise have received.
But critically, banking the income over the next 12 months allows the chancellor to fulfil his aim that debt would be falling as a share of GDP by 2015-16.
When it comes to the health of the economy, Osborne singled out international factors – not least the standoff between the combative Greek finance minister, Yanis Varoufakis, and his eurozone partners – as the key threats facing the economy.
Yet perhaps the largest question mark hanging over the future of Britain’s economy lies at home, in our woefully weak productivity record.
Rising productivity – the amount of output each worker produces – is the key to generating sustainable economic growth and higher living standards.
But while the UK economy has been creating jobs at the rate of more than 100,000 a quarter, allowing Osborne to claim that “Britain is working”, the fact is these workers are producing far less – and so being paid much less generously – than economists would predict.
In this latest set of forecasts, the OBR has scaled back its expectations for productivity growth; but it still expects a recovery to something like normal growth rates. And no one knows whether that will yet prove over-optimistic. As the OBR puts it: “Since it is difficult to explain the abrupt fall and persistent weakness of productivity in recent years, it is also hard to judge when or if productivity growth will return to its historical average”.
The balance of growth – between saving and consumption, imports and exports, debt-fuelled property speculation and sustainable long-term investment – is also far from what the chancellor hoped for. The OBR says the current account deficit for 2014 – probably the best measure of whether Britain can “pay its way in the world”, as Osborne likes to say – is likely to be at its highest level since the 1830s.
And two more inconvenient facts mar Osborne’s claim to have put Britain back on the road to recovery with the “long-term economic plan” that even the most disinterested voter must by now be bored of hearing about.
First, most of the modest upgrade to the Wednesday’s OBR forecasts for Britain’s long-term growth potential resulted not from the government’s economic management; not even from falling oil prices, which should boost consumers’ living standards and cut the cost of production for many businesses. Instead, it came from higher-than-expected inward migration, which boosts the size of the workforce.
“We now assume that net migration flows will tend towards 165,000 in the long term,” it says. That adds 0.6% to potential growth – the speed at which it can grow without stoking inflation – over the next five years.
Second, the recovery only really got off the ground in 2012, when the chancellor made a deliberate decision to ease off on the pace of austerity. We may finally have reached the sunlit uplands of the “comeback country”; but we might have got here sooner.
guardian.co.uk © Guardian News & Media Limited 2010
A bit of bother as the BBC have only reported this a day late after complaints
I just called the BBC on 02087438000 and spoke to a nice chap who said he’d been inundated with calls about the Austerity Demo yesterday. He seemed generally interested to know why he was getting so many calls on a normally quiet Sunday morning so I explained the reason was that the BBC had failed to report anywhere, on TV or their websites, that 50,000 people started this march outside the BBC’s London office. He gave me the number for Audience Services 03700100222 who answe…
Tens of thousands of people marched through central London on Saturday afternoon in protest at austerity measures introduced by the coalition government. The demonstrators gathered before the Houses of Parliament, where they were addressed by speakers, including comedians Russell Brand and Mark Steel.
An estimated 50,000 people marched from the BBC’s New Broadcasting House in central London to Westminster.
“The people of this building [the House of Commons] generally speaking do not represent us, they represent their friends in big business. It’s time for us to take back our power,” said Brand.
“This will be a peaceful, effortless, joyful revolution and I’m very grateful to be involved in the People’s Assembly.”
“Power isn’t there, it is here, within us,” he added. “The revolution that’s required isn’t a revolution of radical ideas, but the implementation of ideas we already have.”
A spokesman for the People’s Assembly, which organised the march, said the turnout was “testament to the level of anger there is at the moment”.
He said that Saturday’s action was “just the start”, with a second march planned for October in conjunction with the Trades Union Congress, as well as strike action expected next month.
People’s Assembly spokesman Clare Solomon said: “It is essential for the welfare of millions of people that we stop austerity and halt this coalition government dead in its tracks before it does lasting damage to people’s lives and our public services.”
Sam Fairburn, the group’s national secretary, added: “Cuts are killing people and destroying cherished public services which have served generations.”
Activists from the Stop The War Coalition and CND also joined the demonstration.
The crowds heard speeches at Parliament Square from People’s Assembly supporters, including Caroline Lucas MP and journalist Owen Jones. Addressing the marchers, Jones said: “Who is really responsible for the mess this country is in? Is it the Polish fruit pickers or the Nigerian nurses? Or is it the bankers who plunged it into economic disaster – or the tax avoiders? It is selective anger.”
He added: “The Conservatives are using the crisis to push policies they have always supported. For example, the sell-off of the NHS. They have built a country in which most people who are in poverty are also in work.”
The People’s Assembly was set up with an open letter to the Guardian in February 2013. Signatories to letter included Tony Benn, who died in March this year, journalist John Pilger and filmmaker Ken Loach.
In the letter, they wrote: “This is a call to all those millions of people in Britain who face an impoverished and uncertain year as their wages, jobs, conditions and welfare provision come under renewed attack by the government.
“The assembly will provide a national forum for anti-austerity views which, while increasingly popular, are barely represented in parliament.”
The Metropolitan police refused to provide an estimate. A police spokesman said the force had received no reports of arrests.
A spokesman for the prime minister declined to comment.
guardian.co.uk © Guardian News & Media Limited 2010