Saturday, 19 January 2013

The Unfair State – VicTORYan Britain




Since the so called Financial Crisis of 2007/8, a great deal has been made by conservative parties across the world to convert a crisis of the private sector, into a crisis of the public sector.  Today's blog separates fact from fiction and explodes the Tory myth of the bloated welfare state, being the cause of all our ills.

The Lie

                                              

British Prime MinisterDavid Cameron bemoans a ‘something for nothing’ culture. This lineal descendant of King William IV, great grandson of a 1st Baronet, grandson of a 2nd baronet, son of a stockbroker and an aristocrat gifted with an Eton and Oxford education (and one might argue his career in politics) through sheer privilege of birth, with a family fortune made in tax havens, might be said to know something about getting something for nothing. He has after all, gotten rather a lot that way himself.

Listening to the language of the ‘Welfare Debate’ in the UK today, one would think that the former Labour government went on some sort of pseudo-socialist spending spree, the working classes lost their work ethic, and when the last penny was spent the economy crashed. 
This, however, is simply a myth.  A series of well peddled lies, said repeatedly at ever increasing volume over a number of years.  As Lenin stated in the early 20th century: a lie told often enough become the truth. 

The political classes have compared Austerity to ‘tightening our belts’, ‘steadying the ship’ and other such amenable metaphors.  These simple sound bytes make it appear as if Britain is merely getting its accounts in order after a period of fiscal folly. 

The Truth

                                                   

However, one big part of the story is missing from this narrative.  Namely, the Financial Services industry and capitalism itself.  In fact they have been neatly forgotten.  One might argue that were it not for the Occupy movement, the finger might never have been pointed successfully in the first place. 

So to recap, in 2007 the central and investment banks failed.  Their whole system collapsed.  Not by some external shock, a natural disaster or an act of ‘terrorism’, but under the weight of its own avarice.  By leveraging debt to infinite multiples, selling toxic debts on as ‘assets’ and insuring against those assets doing exactly what toxic assets do; first the mortgage lenders, then the insurers and finally the investment sections of the banks folded like the house of cards they were.  They imploded, spectacularly, overnight - the domino effect of their collapse ricocheting around the globe.  After decades of gorging themselves on a diet of debt and caviar, the system simply broke.

It was the deregulated, run away banking system that crashed the global economy.


The Cost


                                                  

When the chips were down and all looked lost, the banking community came to the UK government and begged for welfare.  The government paid out.  Overnight, they converted the private debt of those banks into the public debt of the nation.  Fact. 
To date, the UK taxpayer, without being consulted, has been made to pay almost 2 trillion pounds, that is two thousand billion pounds, to the richest people on earth. 
To put this in context: the total UK government spend per annum, is £694.9bn.  So four years of total government spending has been spent in on ‘saving’ the banks.  This is twenty years of NHS spending (£106.7bn a year), forty years of education spending (£48.2bn), or five hundred years of job seekers allowance (£4.9bn a year). This is the sheer, horrifying scale of the so called Bankers Bailout.  So, if you consider unemployment to be a drain on the state expenses, yet could fund 500 years what we currently spend on it with the Bailout Fund, you might want to get a little busy beaning up on this issue.

The Assault on the Social Contract


As a result of diverting public funds to this questionable purpose, the current government has launched an all out assault on the social contract.  The whole idea of a contribution based social security system is being undermined. 

The Work Programme, compels those receiving unemployment and/or disability/sickness payments, to ‘work’ for their payments for private corporations.  If a corporation has a job, it should pay a fair wage for a person’s labour.  If someone is unemployed, they are paid a social security payment whilst they find work.  Both these ideas are entirely undermined by the Work Programme.

The decision to use private IT firm Atos to reassess every single person claiming disability and sickness benefits over the course of a year, makes a liar of a whole swathe of the population.  The language used to justify this demonises some of the most vulnerable sections of our society, the very people the social contract was intended to help most.  
As a result, 32 people per week have died after failing the Atos test and being deemed fit to work.  Further stories came out during a parliamentary debate on 17th January 2013, including a woman with Crohns disease and severe incontinence which often results in hospitalisation, told she was fit to work if only she’d wear a nappy.  Or acclaimed Scottish writer Paul Reekie, who took his own life after the government slashed his benefits.  Rather than leaving a suicide note, he left the letters informing him of his impending impoverishment scattered about his body.  All whom could have been taken care of, if we weren’t prioritising public money on private interests.
It is no surprise that hate crime against disabled people rose by a quarter in this same year, as the whole community was made responsible for the cuts to public services. 

Meanwhile, pensioners are choosing between eating and heating their homes due to the exorbitant energy prices, whilst the energy companies themselves report record profits.  They are also being asked to work longer and pay higher contributions in order to receive a smaller pension. 

As for the National Health Service, NHS hospitals built under the dodgy PFI schemes are starting to fold under the weight of the debt repayments and unmanageable service costs to the private partners and are now being sold off at a pittance to those same private providers.  This means the tax payer is made to pay not only the cost of the hospital, staff and services, but now a profit margin too.  At the same time, the government is busy creating tax breaks for those companies.  Yes, the companies who make their profits directly from the tax payer will not be paying reasonable tax rates themselves. 

It is the same story in education, where Academies (limited companies able to create their own curriculum and make a profit) now make up 50% of schools and the government actively promotes state schools becoming Academies. 

Prisons, police stations and the probation service are also now run by private, profit making providers such as G4S.

In short, the government transferred private debt into the public purse in 2008, whilst before and since, the government (Red, Blue or Yellow) has been allowing the private sector to profit directly at the tax payers’ expense.  Then when the public purse creaks under the strain, blames the service not the plundering.


 It’s Not a Recession, It’s a Robbery

                                                                                                                                                           
It is important to remember that this social contract was constructed to remedy the failures of the Victorian concept of welfare, which was limited and filled with moral judgements on the deserving and undeserving poor, which relied on philanthropy over social responsibility.  The social contract was our decision as a nation to sever the link between life chances and luck.  It was agreed by generations before us that we prospered together, and a promise made to every child that regardless of where and in what circumstances they were born they were guaranteed an education, healthcare, and help when they needed it.  So the Big Society is no new idea, it is the attempt to bring back the Victorian concept of welfare, and free the tax pounds up from helping each other, to helping big business.

David Cameron lamented in a June 2012 speech “Today, almost one pound in every three spent by the Government goes on welfare.”
I found it incredible that the promise of treatment when sick or injured for every person in the land, the compulsory education of every one of our children, the guarantee of financial support for women to allow them to give birth and raise their child for the first months of its life without seeking employment, the provision that abandoned children are given homes, food, and care, that our fellow citizens who cannot find jobs or are unable to work through sickness or disability are cared for…. all happens for less than one third of our taxes!  That’s a bargain!  Frankly, what are we spending the other two thirds on? I hope it is spent as productively.

But underneath Cameron’s argument lay the truth of this neoliberal paradigm: public money spent on the public is a waste.  Public money should be used to ‘promote the economy’, which means, spent on business, not people.  In essence, the social contract is a burden and not of immense social value in and of itself.

Some might argue that businesses are people, that they are wealth and job creators.  This is also a myth.  The people come first.  People are not just units of labour; but mothers, fathers, carers, and holders of other talents contributable to our society above and beyond their value to a corporation.  This demonstrates that those things which make sound economic sense from point of view of a corporation are not synonymous with those which make economic sense to a society.

So…..what?


We have to quit our addition to Proof by Assertion – the practise of believing a thing simply because it is said repeatedly.  We need to understand, once and for all, that this austerity is not a temporary move whilst we tighten our belts but simply a plundering of public funds by a corporatized government.  We need a new idea.  Before that, we must take the boot from the throat of our disabled, sick, unemployed, neighbours.  We must quit parroting the sound bytes.  We must shake off this bizarre conversation about ‘doing our bit’ for the national good by accepting the relentless lowering of wages, rising of pension age, loss of job security, and other assorted assurances that have kept the worker safe from excessive exploitation in the UK since the efforts of citizens past to win them for us.  The next ten years may well define the next hundred, and it is on us how that plays out.  There is no cavalry coming, we cannot wait for heroes, we are it. 

We need to say no, it is not acceptable for 32 people to die a week under duress by the state.  No, it is not acceptable for people’s labour to be compelled by corporations under threat of hunger and homelessness.  No, it is not acceptable for public money to be used to bankroll a zombie economy of capitalist cannibals.  No, it is not acceptable to blame the hardest working people in the land; the ones who teach the children, heal the sick, clean the streets, transport the goods, build the roads – for a economy that is in failure through plunder by the wealth hoarding top 1%.  This political and economic mess, like the ecological mess, cannot and should not be left for our children and their children to deal with.  And all it takes is a little solidarity.

Actions you can take:
Move your Money from the big banks to credit unions
Boycott Workfare - boycott the companies which profit from forced labour.
Find out how you can engage locally and nationally with decision makers, get in touch and encourage your networks to do likewise on issue of importance to you

And finally….just be a part of the broader conversation.  Don’t let this lie transmit via your lips, call people out who make comments which are based on this lie now you are armed with the facts, be brave and own your citizenship.

1 comment:

  1. This is amazing! I agree with all of this, thank you for explaining everything so clearly re the economics side of things - even I - a maths struggling English teacher can understand the finer points of what I vaguely knew was happening. Another victory in the war. Posted by Annikki Devine ( real name)

    ReplyDelete

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