“The savage rules of the almighty Market have created the conditions that are speeding us to destruction”.
Paul Halas: “As we approach the 2020s there’s a growing awareness that we need change and we need change now. Running the country according to the savage rules of the almighty Market has created the conditions that are speeding us to destruction”.
In the Western Daily Press (26th April) Paul describes the Conservatives’ genius in persuading millions of long-suffering voters that the national economy operates like a household, so in order for the nation to “live within its means” we all have to tighten our belts.
But this concept – invented by Margaret Thatcher’s think tanks – was directed only at the 99% who always “suffer the destructive effects of austerity” as Halas points out.
The cuts to health, education, transport, disability benefits and other sectors go un-noticed by the I% who can afford to opt out of these systems – symbolised here by one of her ministers.
The household economics concept, Halas continues, ”echoed by every administration since . . . (is) easy to understand yet utterly meretricious”.
He refers us to sources such as the Office for Budget Responsibility, so the writer obediently found the latest report, which certainly did not confirm “the impression that everything in the garden is rosy”. Tax receipts have risen, but there is no indication that “lashings of money are flowing into the Treasury” as had been stated in the same column on 23rd April.
OBR: damned with faint praise?
- The economy ended 2018 growing a little less strongly than we expected in October. In recent weeks survey indicators of current activity have weakened materially, in part reflecting heightened uncertainty related to Brexit.
- The Government’s stated ‘fiscal objective’ is to balance the budget by 2025-26 and past forecast performance suggests that it now has a 40% chance of doing so by the end of our forecast in 2023-24.
- One risk to the public finance metrics that we do expect to crystallise over the coming months is an improvement in the accounting treatment of student loans . . . we estimate that it could increase the structural budget deficit by around £12 billion or 0.5 per cent of GDP in 2020-21.
- Net trade and private investment were markedly weaker than expected, weighed down by a slowing global economy and Brexit-related uncertainty. Business investment has fallen for four consecutive quarters – its longest continuous decline since the financial crisis.
Halas expands on tax issues and the misdirected quantitative easing adventure:
Although the prime function of tax is to regulate the economy and keep inflation under control, the failure of many of the richest individuals and corporations to pay their dues, thanks to absurdly flabby fiscal legislation, has helped fuel the UK’s runaway inequality and damaged society immeasurably.
It is estimated that 80% of new money created (by the government, via the banks) ends up into the coffers of the financial institutions and their clients, rather than funding investment and welfare as it should.
And ends: “The only sustainable way forward is to invest massively in greener forms of energy and greener transport, to create a greener infrastructure and a greener environment. This won’t be possible without a vast reduction in inequality, more public ownership, more localism, and a far more cooperative approach to economics – all policies the Labour Party is adopting. All those with vested interests will doubtless raise a billion objections, but the consequences of keeping our heads in the sand and trusting the Tories to come up with solutions would be catastrophic”.
Comments on an FT article by Philip Stephens
No policies? Every time I see Jeremy Corbyn being interviewed or giving speeches he is addressing these very issues and more.
“Who can worry about housing, schools or transport, let alone the mundane aspirations of Middle England, ahead of the great liberation struggles.” I don’t know where Philip Stephens has been but every time I see Jeremy Corbyn being interviewed or giving speeches he is addressing these very issues and more.
I would suggest he and the Labour party have lost the working-class vote thanks to the previous Blair government being non representative of them. Remember Mandelson talking about being: ” Intensely relaxed about people getting filthy rich as long as they pay their taxes…?” Corbyn has also suffered very badly by the press. Mrs May has profited by Cameron’s mistake and badly handled Remain campaign and we are now at the mercy of this unelected PM and her party… (see also JC policy docs here)
Philip Stephens creates a narrative that doesn’t fit the facts. Corbyn has delivered effective attacks on the Government on welfare, the NHS and housing, some producing small U-turns.
He also travelled up and down the country campaigning to Remain. The problem was he and the Labour Party failed to breakthrough the media ignoring their campaign and focussing (in terms of the Remain argument) exclusively on the pathetic and useless official Remain campaign.
Jeremy has been democratically elected twice to be leader. His record should in no way be considered dismal. He has consistently delivered his honestly and long-held beliefs.
Rubbish analysis as per usual although the historical throwback is well put.
Corbyn does care about housing, education, schools, middle england, under invested regions (it was Corbyn who was talking about a migrant impact fund), transition to Green energy.
Corbyn far-left? Inaccurate and “un-FT”. Corbyn seems to be a middle of the road socialist, at least by normal European standards.
Far-left policies include abolishing private healthcare, private education, the monarchy, making all third-level education free, nationalising banks and railways and a number of other things, some of which would probably be quite good for the country.
As it is, Corbyn seems to be a middle of the road socialist, at least by normal European standards. Far-left European politicians would include Vladimir Lenin, Rosa Luxembourg, Alexander Lukashenko and any number of dictatorial 1980s Communist party secretaries in Warsaw Pact-era eastern Europe. Jeremy Corbyn is quite clearly not in that zone unless one is a swivel-eyed Daily Mail reader.
A question: When Brexit is done and May is left standing there blinking vaguely and surrounded by the wreckage of the economy where will the Conservative Party be in the eyes of the electorate?
Its reputation for sound economic management will have been trashed along with the economic damage it has just imposed on the country so who wins?
Philip you are doing the FT (and its readers) a signal disservice by misunderstanding Corbyn and the Labour left.
Copeland was never likely to vote for an anti nuclear Labour Party – and well you know that. The wonder is that the Labour Party nearly won the seat despite being clearly antagonistic to the existence of the region’s biggest employer. WE, the subscribers to the FT, expect objective reporting that enables good decision making.
Corbyn and labour can’t win at the moment, if they go to the middle and ignore the democratisation of their party they will lose, if they stay a democratic left party the boomers and those with assets won’t vote for them as they fear socialism.
Meanwhile the millennials and future generations bear the brunt of public debt created privately, and shareholder capitalism which is a race to the bottom, generation rent, and the absurd 40% of income rent costs in areas where there are plentiful jobs and opportunity epitomises the modern day surplus extraction and misery of those who have not lived among the golden age of capitalism, add tuition fees, stagnating public services (NHS), erosion of employment rights and you can see why Corbyn is confident among that 20% (of which I’m a part, ha ha ha, how funny he’s so inept ha ha ha lets all laugh at corbyn because there are so many other alternatives out there that are SO much better).
The Tories will continue their irrational, economically illiterate policy that is not running the country into the ground but causing growing social issues, and new social actors will emerge from the post 2008 age eventually tipping the balance towards something more corbyn-esque. Until then it will be the same old, same old.
Corbyn’s crackpot policies are simply outrageous! Spending a little more on the NHS and primary school education? Providing a bit more affordable housing in the midst of a housing crisis?
Failing to asset strip the public infrastructure? Rowing back a bit on the vast, exploitative Sports Direct-ification of the British economy? Why, this is simply unpatriotic! How “radical” – somebody stop this crazed moderate, centre-left European-style social democrat Corbyn before my taxes end up a little bit higher and the proles end up with a slightly better quality of life!
God forbid that poorer people should ever have slightly better quality of life. Who knows where that might end? It’s better not to give people hope. It just encourages them to think.
I agree. Britain’s low wage, low skill, low investment, low productivity economy would be severely jeopardised by the dangerous, radical policies of Jeremy Corbyn. Sure, he’s languishing in the polls now, but the proles are a fickle lot and cannot be trusted to consistently vote for their own impoverishment. What if Corbyn dons a Union Jack leotard and starts leaping up to belt out a few verses of ‘God Save The Queen’ with gusto on the next campaign trail, waving a couple of flags about like the dickens. Why, the proles might even be duped by this charade into voting him into office! This would leave us all at the mercy of an outbreak of half-decent working and housing conditions for the proles at any time. This simply would not do, too much has already been invested by the Conservatives in their cooption of UKIP’s policy platform!
There was no money left. The Tories have just borrowed billions. The crash will be spectacular.
This article is high in the running for one of the worst I have read in the FT in years. We are in the end times of Neo-Liberalism, an experiment where maybe 20% did very well, and 80% were massively left behind.
Corbyn, Trump, Brexit are consequences of a system that has failed, and a financial system that collapsed in 2008, never a crisis always a collapse. Stevens has no understanding of the why’s of brexit or the rise of Corbyn. The left-right paradigm is dead. I could not find one sentence in this article that is not total ideological nonsense.
If Jeremy has got under the skin of Philip Stephens so badly he must be doing something right.
Most Labour MPs and most journalists hate Corbyn as if he were the devil. He represents the one pole of the process of polarisation caused by the 2007-9 Great Recession and the continuing crisis of world capitalism.
Let there be no mistake. The reason Philip Stephens is so horrified is because if his buddies amongst the old Labour MPs who are career politicians, were instead people of principle and socialists, then the Labour Party would be challenging for power.
The lesson of our era is the fluidity and rapidity of change. If Corbyn is right, (and I think there is lots of evidence to back him up), if he can be seen to be a leader of masses on protests and demonstrations, this will sharply polarise politics and this may match a simultaneous collapse in Tory support. The Labour MPs who are resigning and trying to oust Corbyn again with their endless press briefings against him are part of a deliberate coup attempt. This time a sort of coup by water torture. They will fail again. The only major criticism one can make of Corbyn is he is too soft on these saboteurs. There are times when a sword must be wielded.
The worrying thing about this analysis is, his policies weren’t even that far left, they were definitely more central than Thatcher’s. Yet the FT reports this as if he’s Lenin/Kim Jung Un etc. His biggest failing for the press is he wants a meritocracy and for companies which require state support (through the use of tax credits to prop up salaries and increase profits and bonuses) to not pay dividends, which is effectively the Government paying the rich in an indirect way. Yes he has his failings, as does everyone, but generally speaking a lot of his economic policies would work fairly well at creating a long term balanced economy.
Corbyn, and his anointed heir, need to show there is an alternative to the Conservative Creed. Perhaps he needs to lose an election to clear out the MPs who are undermining him.
Perhaps this will result in his own political demise. But if he has a suitable succession plan in place then his success will come after he is gone. With the LabouraTory MPs planked off the sinking ship, seats will be freed for real Labour candidates for the subsequent election.
Facetious commentary. Corbyn has inherited a mess of a party with crumbling membership and totally out of touch MPs.
Time and time again polls have shown that the public want a ring fenced NHS, working railways and better care for the elderly, sick and disabled. To finance that he has stated that he will increase funding to the HMRC so that it can go after companies that are not paying their taxes (last year’s estimated unpaid tax was £34 Billion) which is probably why this article has been written in the style it has.
People want the state to intervene if something isn’t working. The current level of income disparity is something that is directly affecting the world by creating the perfect soil for fascism. Yet no other political leader wants to do anything about it (since it will affect their careers after being an MP).
Versus the CIA and capitalism he is the best chance we have of having a fair society