Don’t forget where you were when the CSR hit us


11:25 pm - October 19th 2010

by Paul Sagar    


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Most people remember where they were on 9/11. Epoch-changing events have that effect, especially when they are so spectacular and obviously far-reaching in their ramifications. But not all epoch-changing events are spectacular, and they don’t always advertise themselves so obviously.

With that in mind, remember where you were today. The 2010 Comprehensive Spending Review may become a date historians return to.

Much of Britain’s post-war history can be summarised – simplistically, but with some accuracy – as follows.  After the devastation of global war, and the realisation that unchecked economic and social strife leads to the violent recourse of desperate extremist politics, west European nation states erected new social settlements both to rebuild shattered economies and polities, and to serve as prophylactics against the politics of extremism.

During the 1970s the social settlement in Britain underwent extreme strain for complex reasons, but in particular due to economic difficulties of both domestic and international origin. In 1979 Margaret Thatcher was elected Prime Minister, and the first phase of a radical re-settlement began.

The position of organised labour within Britain was crushed, and the role of private enterprise was drastically increased. Deregulation of finance and industry expanded the scope of market provision, and contracted the role of the provider-state. However the core of the post-war social settlement – what we loosely call “the Welfare State” – was left essentially intact, although modifications were made to the way it provided services, reflecting moves towards a general market-default.

From 1997-2010 Tony Blair and Gordon Brown’s New Labour put the Thatcher project on hold, but did not reverse it. If anything the role of private enterprise in particular was expanded. Although core components of the welfare state – in particular education and healthcare – saw enormous increases in spending from 2001 onwards, this was undertaken within the framework of accepting the Thatcherite re-settlement on the economy as a whole.

Although laudable efforts to reduce poverty were undertaken – with some considerable successes – socio-economic inequality increased, as the marketisation of everything continued apace.

From May 2010 onwards, what can be described as the second phase of the Thatcherite resettlement began. Under the banner of massive fiscal retrenchment – justified (rightly or wrongly) as a necessary response to the devastation of the 2008 financial crisis – the Conservative-LibDem Coalition has proceeded to instigate massive spending cuts which are fundamentally over-turning the post-war “Welfare State” and attendant social settlement.

Indeed, it is worth noting what has already been pushed through since spring 2010.

Whilst Michael Gove’s highly ideological free schools programme, and parallel withdrawal of ordinary state school funds, has attracted much attention it has simultaneously distracted from the massive reconstitution of the NHS being conducted by Andrew Lansley (arguably without democratic mandate). Universal child benefits have already been withdrawn.

The affordability of higher education for all may be finished as the LibDems U-turn on one of their oldest electoral promises. The system of state benefits has come under severe attack from Chancellor George Osborne, as dramatic welfare caps are introduced.

And reports ahead of the CSR going official indicate that the Government already expects at least half a million new unemployed from public sector redundancies alone.

And this is only the beginning, the warm-up; the light shavings of the razor before the axe falls proper.

As John Gray has explained so well Cameron, Osborne and Clegg are Thatcher’s ideological children. They see this as the only way, for they have known no other way.

And thus, it may very well come to pass that 20th October 2010 will be noted by future historians as the day the British social settlement completed the change of direction begun in 1979, entering new – and as yet, uncharted – waters.

So remember where you were. Your grandchildren may want to know.

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About the author
Paul Sagar is a post-graduate student at the University of London and blogs at Bad Conscience.
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Story Filed Under: Blog ,Economy ,Fight the cuts

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Reader comments


You think we should be sober Paul? Sod that!

Who the hell can afford grandchildren?!

My prediction. The csr will go mostly unremarked by history, save for a couple of obscure economists who will note it’s unacknowledged success about 30 years from now, probably by comparing it with some other countries that did not reduce spending at this juncture: http://www.econlib.org/library/Columns/y2010/Sumnerneoliberalism.html

The problem is that it is difficult to conceive how a lack of spending and intervention can do good. But it can do good. The good is just so dispersed it doesn’t get noticed for a long time, by which time it can be attributed to some other policy or event.

jeez…it was such a disappointment…a slightly less incompetent version of Brown and Balls. The Government bottled the chance to save this nation. We will descend into a nation of Sunny lookalikes clutching home-brewed bottles of vodka (for Sunny read heroin), hoping for the world to bail us out.

I was in Calcutta in 97 when Blair was elected. That’s the real date to remember for when the country got fucked.

It will soon be gorgotten.

Come to think of it, this is all a non-event compared to the memories people will have when rogue states acquire nuclear weapons. (sorry about spelling in previous post, blame London Pride and Speckled Hen from last night !)

And yet public spending will still end up at, erm, 40% of GDP – pretty much the average of the past 30 years and *above* the level of the 1950’s.

Get a grip.

I’m with you, Paul, this is a disaster-in-waiting. If some of these cuts were balanced by reformist spending I might be mollified. But as you point out, it’s all about conservative ideology. Instead of ‘protect the children’; ‘don’t breed if you can’t afford them [you animals]’.

I had a wee rant about it myself, if anyone’s interested: http://sirenofbrixton.wordpress.com/rants/punish-the-people-who-deserve-it-george/

@ 8

Exactly and interest payments on debt will still be ridiculously high. How about my personal version of economics:

* Don’t spend what you don’t have.
* All borrowing is for investment only.
* Luxuries like drinking, smoking, holidays, new cars etc. are only bought with genuine savings. Yes..yes…I know finance sharks would go out of business ……..Yawn !

@ 9

Agree totally. If we waited ’till we could afford to have children there wouldn’t be a ‘next’ generation. On the other hand, sexual behaviour needs a closer look on that subject ?

12. Flowerpower

I dare say this would be a truly historical and memorable event if it were not for the plain fact that all Osborne will be doing is returning the total level of real-terms public spending to what it was under Tony Blair in 2006, a figure higher than it was any time under Labour between 1997 and 2006. Not only that, but this titchy adjustment will take four years to phase in, such that next year spending will be higher than it was in 2009 (a recession year).

The ratchet has ratcheted. Talk of unraveling the 1945 settlement is tosh.

I was busy taking a dump…. on the poor.

Because that is, of course, the entire point of reducing government spending to 2006 levels over 4 years. To hurt, maim, rape and burn the poor.

13 – Come on, you remember 2006. The workhouses, the paupers’ graves, the pure Dickensian poverty of the country – how can the Tories possibly think of returning us to that, the bleakest period in this country’s history?

2006 well the best period for me on benefits was Thatcher last years in Power, I was given a decent benefit package with DLA a newish benefits which changed my life. I could not get out buses would not take a wheelchair trains were a no go and Taxi did not want to know. I bought a car using DLA had the front seat removed to accept a wheelchair and my hands could control my driving, Press the steering wheel brakes came on pulled the steering wheel accelerator, all other control;s fitted to the steering wheel, all from Thatcher, Labour played up hell about better use of the benefits.

I also had benefit rises which covered my rent rise and council tax rise, labour removed these from the package and I ended up going from a rise of £4 a week down to 75p under Blair.

Before you ask , I’m classed as Paraplegic.

@ 13

Too emotional, it doesn’t help your genuine concern.

Our task is to come up with realistic alternatives. Anyone can blame anyone else but it’s only ya-boo-sucks-rhetoric.

Lets not forget it was us the public (consumer) who wanted more and more for at least 10 years.

The banks duly obliged with irresponsible lending and surreptitiously sold on those debts under various dodgy financial instruments when they got to hot to handle.

Meanwhile and incompetent Gvt was happy to claim years of continuous growth – all compliments of the national credit card. Now we have to face reality collectively.

Personally I think we’re doing well compared to the French and Greek positions, they are now dealing with our 70/80s situation.

I was buying a watch when I heard on the shop radio that John Smith had died. The worst event in British politics during my lifetime apart from Thatcher’s second victory. I’m spending today redoubling my efforts to move to a country with higher taxes and a better quality of life

John Smith met him a few times at Conference one of the nicest people you would ever want to speak to, unlike Brown and Blair who could not wait to pass you and get away, Brown was speaking to you while looking for his next contact, he’d say yes yes nice to meet you and he was gone. John Smith really did speak to you and he spent all the time it took for you to say what you wanted and he’d answer you. yes he was the biggest loss to the party.

As I said over at Paul’s blog:

““west European nation states”

Yes, but to then elide to the specific and particular ways in which the UK did is rather to sell the pass.

Because the other west European states constructed said social settlements in very different ways. For example, Holland has always had a school voucher system: Swedish and Danish health care systems are not free at the point of consumption (there are low fees to be paid for visiting the doctor for example) and are run by the counties, not as a national monolith.

Sweden and Denmark again have much more private involvement in the provision of what are usually considered public services: much of Denmark’s fire and ambulance services for example are provided by a private company (now part of Group 4S) and have been for most of the last century. The French system of health insurance is a real health insurance system, the “national” system only paying 80% of the treatment cost for most diseases, the balance usually being made up by private insurance. Both the German and French systems have myriads of different providers, charity, not for profit and profit making, the insurance, both State and private covering them all.

On labour protections, the Nordics are fire at will, with high unemployment and retraining protections, the Latins make it very difficult indeed to fire with low unemployment and retraining protections.

One can indeed make the argument that the UK has done these things in one particular manner and that this is now being changed. But almost all of the changes are the adoption of ways in which other West European countries have organised their social settlements in this post war period.

Arguing about whether they’re adopting the good methods out there or not is another matter: but there’s pretty much nothing which is being proposed which hasn’t been in use in some other comparable society, some of them much more “social democrat” than our own, for decades.

A change in the UK’s post war settlement, yes. But out of the ordinary for the general European post war settlemnt? No, not really.

Indeed, the financial aim seems to be to return the State to about 40% of GDP….around and about the post war average actually. Just with different and, as I say, already used elsewhere, delivery mechanisms.”

This just ain’t the destruction of the welfare state folks……

@16 Evil Tory/Yellow Tory Scum!

How dare they propose sending our kids back to workhouses and up chimneys!

Real comment from a True Defender of Socialist Britain on Facebook:

“Clegg can now tell kids who are freezing to death, here’s a nice new book, before introducing a tax on puppies”

I wonder if Thatcher is holding on long enough to see her dearest wish come to light, namely the closure of the NHS, Welfare State and the public services? She appears to be hanging on for grim death at the mo.

Anyway the Tories have announced the widest reaching of their ideological and potentially election winning cuts. They have linked the licence fee to the World service, thus preparing the way for a Daily Hate attack on ‘Why should licence fee payers prop up foreigners’ and ‘BBC should not be competing with foreign broadcasters’.

I fear the BBC have been holed beneath the water line with this one and the worse thing is, no-one, other than the BBC seem too bothered. The Labour need an impartial broadcaster and the BBC is the best we have.

22. Stuart White

Thanks, Paul, for one of the best articles on the significance of the Coalition government that I’ve seen. As you point out, and as some of the comments above miss, the significance lies not only in the cuts to public spending but in the combination of cuts and rapid marketisation of public services.

To those who think this cluster of policies is just run-of-the mill pragmatic politics, I suggest a close (or more than passing) look at the Lansley proposals for health-care reform. Groups like the Muscular Dystrophy Campaign (hardly a bunch of lefties – Tesco Charity of the Year recently) have repeatedly pointed out that the White Paper gives no real indication of how people with rare conditions will be handled under the new system, GPs lacking (by their own admission) the expertise to do the relevant comissioning. The White Paper offers only the sketchiest hints about how people in this category will fit into the new system. If one was reforming health-care pragmatically, one would surely sort out as a high priority how the new system you want would cope with some of the people in our society with the most acute needs – rather than treating the issue as an afterthought….

@ 20 (blanco)

Not me pal, just been around long enough to know reality when I’ve been able to observe it for 13 years.


Reactions: Twitter, blogs
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