Friday, 19 April 2013
Was Cameron Right? Are We All Stupid Now?
Cameron's observation at Margaret Thatcher's funeral that "We're all Thatcherites now" caused a storm of contoversy this week. Labour leaders grew red in the face, blustered and muttered "How dare you"! To demonstrate his adherence to a more socialist view of the economy Ed Milliband swung into action and told supporters in South Shields today that a future Labour government couldn't promise to repeal the bedroom tax. He was also at great pains to distance himself from those on the left who had celebrated Thatcher's death telling them that "I think we need to conduct our politics in a respectful way." Prseumably he was talking about the respect that the Tories have shown the people of this country over the last three years which has included such respectful policies as viliifying the disabled, reintroducing slavery for the unemployed, rewarding criminals with bonuses and state honours and stealing the NHS. Austerity, it would seem, is here to stay whether the electorate vote for the right, the left or the centre. In that sense Cameron was quite correct, except the "we" he referred to was the political elite. The rest of us have our doubts and it seems we have good cause. George Osborne's austerity policy, it turns out, was based on an influential 2010 economic study that seemed to show that a national debt of more than 90% of GDP causes an economy to contract. Unfortunately it now appears that the authors of the study, Carmen Reinhart and Kenneth Rogoff, made a slight mathematical mistake and instead a national debt of 90% actually leads to a growth rate of 2.2%. This highlights two interesting characteristics of neoliberal economists - they can't count and they are completely ignorant of history. The fact that nations cannot cut their way out of recession was proved quite conclusively during the 1930's and, despite neoliberal efforts to pretend that the 1930's never happened, they actually did. So, when Cameron said "We're all Thatcherites now" what he was actually saying is "We're all as stupid as she was now."