I know, I’ve covered the cuts before. But a couple of things I read over the weekend really hammered home to me the sheer economic wrong-headedness of the scale and speed of the cuts that are going to happen come October 20th.
The first very simple point was made in a review of Will Hutton’s new book Them and Us. The British public debt is currently at 60% of GDP. Although a long way from Gordon Brown’s 40% golden rule, this is “far from crisis level”. Other countries have held much, much higher debts for far longer, notably the USA. These cuts are done to please jumpy money markets; a good enough reason, but surely the answer is to calm the money markets rather than shrink the state to pre-WW2 levels?
The second, and more important, is that cuts on this scale, at this time, make no economic sense.
The Tories have been bandying about this idea of the Big Society for a while, and have talked of the private sector taking the place of the state once the cuts come in. Both of these concepts are, not to put too fine a point on it: bullshit.
The Big Society is a vague, ephemeral concept involving people working for free in communities that have no community spirit. I think. It’s hard to even be that vague about it. And the idea of a private sector that has just suffered one of the worst downturns in living memory growing to take the pain of public sector cuts is ludicrous.
Instead, you have hundreds of thousands of people already out of work, with the government soon to be laying off further hundreds of thousands of people, who will then go on benefits and not have enough money to spend in the private sector. With people not spending in the private sector, there are no jobs to give people so that they have money to spend. You see where the problem is?
So you end up with a lack of public services not being provided by anyone else except those kind hearted souls who will do it on a volunteer basis (well I suppose the unemployed make up in time what they lack in money) and not enough money going into the economy to stimulate the private sector, let alone tax revenue to fatten up the public purse.
Sounds like we’re all going to have a lot of time on our hands.
The problem with life is…a jumpy money market and a Tory government.