As the government push on with their rigid policy agenda it's more important now than ever to get our voices heard, writes Brendan Barber.
Brendan Barber is the general secretray of the TUC
Ed Miliband’s decision to speak at the TUC’s rally for a future that works tomorrow has been seized by some Conservatives as proof he is outside the political mainstream.
But it is the government that now looks extreme. When they won the election the economy was beginning to grow. But both deep rapid cuts and inflation driven by a VAT increase worked together to put the economy back into a double dip.
While Greece, Ireland and Spain have been coerced by the eurozone to slash spending, the UK has opted for voluntary self-harm. There is, and always has been, an alternative to arbitrary targets to reduce a deficit caused by a three decade-long faulty economic model in just a few years.
When the chancellor first announced his strategy it was at least possible to believe he was genuine if mistaken. He really seemed to think cutting public spending would boost the private sector and thus aid growth. But that excuse no longer works. The evidence is in. Instead of growth the economy has shrunk. And while it would be very surprising if the economy does not grow a little after last quarter’s dire decline, this is not the same as recovery.
Now the government also has to deal with the IMF bombshell. As they used to say in headlines, it’s official: cutting spending when the economy is in recession does more harm than good.
This is potentially very bad news for George Osborne. While few read the details of IMF reports, the Office for Budget Responsibility do. They have based many of their forecasts on the traditional IMF belief the impact of spending cuts on the economy is only half the sum saved.
But now they say the multiplier effect is much higher and almost certainly greater than one. Probably could even be more than one. In other words the same £10 billion of cuts could shrink the economy by more than £10 billion – a cure worse than the disease. This puts the Office of Budget Responsibility in a difficult position. As they rely heavily on this kind of IMF research, they will now have to revise their forecasts downwards if they are to retain their reputation for independence.
So why does the government persist? Perhaps there was a clue in the chancellor’s speech to his party conference. He talked of the government carrying out a “silent revolution… of profound, long-lasting change”, and “the most radical and reforming period of government this country has seen for a generation”.
The policies that kept Britain’s right out of power for a generation are now being ‘silently’ implemented using the economy as cover. Only occasionally, as with NHS reform, do people notice. And when they do, they do not much like it.
But this strategy will be increasingly difficult as the economic arguments against austerity become ever clearer.
That is why the TUC has called tomorrow’s march and rally. The government wants to keep the focus on the deficit. But what people want is a sustainable economy offering decent jobs and fair wages – in short a future that works. Join us tomorrow in sending a loud and clear message to the government.
6 Responses to “When will this government of rabid cuts learn? Why tomorrow’s march is so important”
Newsbot9
As usual, you’re trying to plead a special case, LB.
I’m not falling for it.
And I *challenge* misapprehensions, sure. I don’t demand as you do that you are the only source of truth. I’m quite happy to say that you’re factually incorrect on issues where you are. As usual.