More cutting remarks…

I was going to post another load of links relating to recent developments in the ‘post’-‘crisis’ economy (sarcastic multiplication of inverted commas intentional) and polity, but I just found out that New Left Project are hosting a week-long debate on the matter which will be far more useful than anything I can cobble together, so head off over there and read Richard Seymour‘s opening gambit. The following is what I had already collated when I found out about NLP’s efforts…

Some banking ‘reform’ pessimism

Serious reform of the banking industry is a long, long way off. Even Robert Peston – who, perhaps fearing that his pessimism/realism would bring down civilization, has recently drifted somewhat rightward (though he’s probably worried that without due deference to the new government, is sources will dry up and sworn enemy Tory “Nick” Robinson will get all the juicy scoops) – thinks that far-reaching reforms might never happen. As fears of a double-dip recession continue to grow, the callous implementation of cuts (the necessity of which remains far from absolute) continues to provoke this very basic question: cui bono?

And those triumphalists who feel that the worst has passed should be aware that the structural faults remain. Peston suggests that the stress tests undertaken on European banks are (basically) ridiculously soft. In the U.S., contrary to early optimism it now seems that more banks will fail in 2010 than in 2009. These are the systemic weaknesses bubbling to the surface as predicted by the gloomiest characters in The Big Short, and, if they are to be believed, with much, much worse yet to come.

Daft and unnecessary cuts

Meanwhile, in the United Kingdom of Austerity, several of the most useful quangos are for the scrapheap. The Sustainable Development Commission, is to be abolished sending an appalling signal that saving a couple of million pounds from one part of the budget (despite the Commission’s unchallenged claim to have saved many times its own budget through its actions) is more important than maintaining (let alone improving) the sustainable parts of the economy. This is consistent with other parts of the budget, including the cut to subsidies for electric cars; again, a few million (and it really isn’t big money) off the balance sheet now is better, according to the Treasury, than the social and environmental rewards for such an investment. Heck, given what’s likely to happen if current climate trends continues, all of these innovations, however ‘inefficient’ they are currently judged to be, will be small potatoes compared to the costs of drastic survival measures in the future.

Also doomed is the Film Council, another case in which each pound invested reportedly reaped several times as much for the economy, and the Museums, Libraries and Archives Council (suggesting we may return to the dark ages of a completely decoupled cultural heritage). This should show beyond all doubt that the cuts are not being made for economic but for longstanding ideological reasons – the government does not believe in state-support for anything unless there is a profit motive, including housing, which is another disaster on the near horizon. Profit as a by-product of state-led growth is unacceptable to the Conservative party.

We already know that there is an ill-thought-out, scattergun aspect to the cuts, the Goveish bits of which are addressed by Steve Bell here. Predictable attacks on “unnecessary,” “fringe” or “frivolous” departments such as these are precisely the misplaced kind of pseudo-rationalism that Jeanette Winterson argued against so effectively at the Hay Festival talk I attended. Never mind the idiocy of axing free swimming for the young and the elderly – which surely has measurable health benefits beyond the immediate remit of the DCMS – the old idea that culture is unimportant because its cash value is difficult to measure has reared its head. Jeremy Hunt should by now have entered the rhyming slang canon, if there is any justice (and brilliantly, one of his several middle names is Wattock).

The hoped-for moderating influence of the Liberal Democrat wing of the coalition is still entirely absent; Clegg’s recent attempts to voice independent opinion were rapidly slapped-down. While six Lib Dems rebelled over the appalling Academies Bill, it’s not really enough to disrupt the march of a government with a c.100 majority. Tom Clark condemns the coalition as anti-democratic and worries what the legacy will be .

Meanwhile – and this is tangential, though hardly unrelated given Osborne’s crusade against government-led demand – my pal Geoff pointed me in the direction of this piece in the FT in which Martin Wolf discusses the political attraction of “supply-side economics”. It doesn’t do much to dispel my view of this concept as hocus-pocus B.S., but it is the most lucid presentation of this dogma that I’ve seen for a long while. I am always inclined to lend greater weight to the arguments of people who have nailed their colours to the mast of capitalism when they end up pulling the rug from under their own feet. With friends like these etc. Moreover, he quotes prominent Republicans – and from the right of the party – who confess that the idea of tax cuts ‘paying for themselves’ is politically-motivated hokum. Rather obvious music to my jaded ears, I must say, but all the while we have a callous know-nothing ideologue at No.11 Downing Street this bears repeating as often as possible.

No wonder David Cameron thinks it’s all a bloody good laugh.

Published in: on August 3, 2010 at 10:06 pm  Comments (4)  

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4 CommentsLeave a comment

  1. Ho-hum, apologies for the cliché overload towards the end. Obviously you can’t pull a rug out from under a mast, however impressive the colours you have nailed to it.

  2. I like this quote from the piece you linked to comparing and contrasting Peston & Robinson:

    ‘Peston is a Balliol man – and has much of that establishment’s intellectual self-assertion (a roundabout way of saying he’s impossibly pleased with himself).’

    • Ha, yes, I liked that too. I don’t think I had heard that Peston went to Balliol. I obviously can’t see the giveaway signs as well as some!

  3. Update: Simon Hughes, who has been one of the least compliant members of the coalition so far, has attacked the plans to axe lifelong council house tenancy. Link here: . I do suspect it will be over something like this, which can be spun as a non-party-political concern, that the coalition will begin to come unstuck. The problem may be that many Lib Dems simply walk out of the coalition, but the government still has a working majority.

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