Welsh Assembly

Welsh Assembly

Friday, 13 August 2010

The Greatest Heist on Earth

There is a disease infecting Britain, the Government would have you believe. No it's not that new NHS superbug that has been in the news. And its not a result of that cloned meat saga either. And it's not even a new combined strain of Bird & Swine flu (which logically should cause pigs to fly). The disease is 'deficit denial.' What it essentially boils down to is  that if you even think of oppossing any of the proposed Government cuts to 'waste' which so far include school buildings, police numbers, free school milk and probably soon the luxury of a working colour TV, you are in fact suffering from 'deficit denial' much akin to denying the autheniticty of the moon landings or that wearing  a tin foil hat stops the CIA from listening to your thoughts. Unfortunately the accusation of 'deficit denial' don't exactly fit with the other excuse for these cuts which go along the line of 'well Labour would have cut anyway". Sadly it cannot, unless your a paranoid schizophrenic, be both.

With every week that passes the risk of terrifying 'double dip' recession looms. Despite sounding akin  to rollercoaster at Barry Island, a 'double dip' would be the ultimate imperical evidence that the Governments slashing has led us on the road to economic ruin. I do not pretend to know whether or not a double dip is around the corner and my guess is that most so-called economic experts cannot for sure know whether we will avoid staring into the economic abyss. But the Bank of England has downgraded growth forecasts in response to the Governments budget and forecast that inflation will rise. Not a positive response. Indeed the Bank also has stated that the only thing that has kept the UK economy afloat and unemployment down is the lingering effects of the Stimulus package which the Tories opposed.

The government likes to boil these problems down to simple arguements that follow along these lines "Any small business or family has to tighten their belts when hard times hit ... blah blah blah ... lets throw those scroungers off benefits..." The continual referencing to the UK as some sort of Mulitnational corportation or the 'UK PLC' reveals how they trully see this country as. A profit making organisation and believe me your not the CEO. They are. The State is not a business. When a business fires an employee their off the companies book's for good. But when the state is responsible for someone's unemployment it has to continue to pay them unemployment benefits. When the private sector is weakened and the public sector is getting slashed back and VAT is going to hit consumers who is going to be spending?

These arguements tend to get in the way of the media narrative of the 'unavoidable' deficit reduction, ignorant of the fact that a mere 3 months ago a majority of people in the general election voted for parties that didn't want to start cutting the deficit this year. Nick Clegg just two days before the election stated that it was "obvious to an eight year old" that the cuts shouldn't start until next year until the allure of ministerial cars waved beofre his face and Clegg is now the mouthpiece for the savage cuts to tame the 'unavoidable deficit' and peddles the great delusion of our times that the recession was caused by "overspending". Unfortunately for Nick, facts are stubborn things. Public debt as a perecentage of GDP was actually higher under Thatcher than under Labour in 2007 before the recession. The reason for the deficit is the £850 billion bailout of the private sector.

What we have lived through may be the greatest transfer of wealth from the poor to the rich in history. We bailed out the banks that caused this recession, with the money of poorest tax payers in this country for their greed and irresponsibility. AIG, Lehman Brothers and HBOS didn't collapse because of 'big government' but because their wasn't enough Government oversight. And now the banking elite who organised the tax payer funded bailout for the richest people in our society are  demanding that we pay once again by slashing the funding of our public services to restore 'market confidence' rather than demanding back our money from banks which have now returned to profit. The Non-Executive Director's, the CEO's and the Bank Chairmen must be asking themselves, in the words of Mel Brooks, "Where did we go right?"

By Dominic from my blog: A Public Service Announcement


  1. Certainly, the bankers did cause most of this mess - but it is the banking culture which the Government allowed to flourish which is the main problem. I am not laying the blame solely at Brown's door, as I know that this was an international financial crisis. In fact, I understand that Brown had been pushing for changes at the International Monetary Fund for several years, and the international community chose to ignore him until we found ourselves in this financial muddle.

    The reality is, however, that the financial services provide a big chunk of revenue for the Treasury, which is re-invested into public services. No government would want to anger the financial sector so much as to encourage them to leave.

    Another point to make is that the banks seemed to have made a loss in their retail divisions, while made bumper profits in the financial markets. This may be why staff across the country have been penalised heavily while city bankers are still in comfortable - very comfortable - employment.

    The Institute for Fiscal Studies' research into how the Treasury's Budget would affect the poor and the rich highlighted the coalition's failure to keep to their promise that cuts would be fair.

    The report shows some disturbing calculations which define the Budget as 'regressive'. The poorest 10% of the population would have around 5% of their income reduced, while the richest would only feel the measly pinch of around 2% (richest 10% would lose 4%; second richest 10% would lose around 2%). While the poor cut back on essentials, the rich can still send their children to elite private schools.

    The government has not been held to account. Labour needs to have a strong opposition leader to highlight these reports. When the IFS was creating similar reports dashing Labour's statistics, the Conservatives did not shy away from slinging reports at them in the Commons.

    Sadly, the press hasn't pulled its weight either. With a strong right-wing bias prevalent in most of the papers and James Murdoch's alliance with Cameron, the more liberal papers are struggling to make their point. The BBC attempts (and mostly succeeds) to provide neutral journalism, meaning that it - quite rightly - cannot express an opinion on such a report.

    Thanks for the post - any opinions on who should be Labour leader?

  2. Hiya and thanks for the comments! Yeah I recieved my three ballots for the Labour leadership and i put Ed Miliband as my first preference mainly because i believe he's articulated what went wrong with New Labour. What about yourself?

    Would really appreciate it if you followed my blog as well as hoping to beef the numbers up :)
    www.apublicserviceannouncement.blogspot.com Thanks!