Incompetence will destroy this government, not the cuts


9:17 am - March 31st 2011

by Sue Marsh    


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It seems astonishing to me that a Conservative Party that spent 13 years in opposition have such poorly thought through policies.

Here’s a quick list of recent developments that should surely leave even the most loyal Cameron-flag-waver feeling a little discombobulated?

» We saw Michael Gove scrap the Building Schools for the Future fund, finding that, in fact he was breaking contracts left right and centre. This led to a high court Judge ruling that, “Gove’s actions over the scrapping of the (BSF) initiative last year had been ‘so unfair as to amount to an abuse of power'”

» Then there are the aircraft carriers that will never carry aircraft.

» Then it turns out that Lansley’s health reforms could in fact mean that the NHS comes under the jurisdiction of EU competition laws – surely something no Conservative government would ever want?

» The ONS confirmed that they have lowered growth projections for every year but one of this parliament. They have also raised the unemployment projections and the debt projections for every year until 2015. Effectively, growth will be lower, unemployment and debt will both be higher than projected by 2015 and Gideon has only been in charge for 10 months.

» Next, there’s this astonishing clip of the Baby-Chancellor which shows he hasn’t a clue how much revenue the Treasury earns from petrol – literally no idea at all, not even in the right ball park.

» Then, Fact Check released this startling analysis on plans to cut Police budgets. After natural wastage and possibly the use of an archaic little loophole to force officers with the most experience and over 30 years service into early retirement, there will still be thousands of posts that need to go. However, it seems that you cannot sack a police officer! Fact Check point out that :

The problem is that a fully-sworn police officer is technically not an employee of a police force but a servant of the Crown, and as such, cannot be sacked.

The answer? Seems the only way out is to sack back office staff instead and make frontline staff take up the slack answering phones and taking on admin roles. It seems that quite apart from going completely against Cameron’s aims to “see police on the streets fighting crime, not stuck behind their desks fighting paper.” It will also lead the coalition into a legal minefield.

» But there’s more! Fact Check also looked into Gove’s 180 Million “bursary” to replace EMAs – a reduction of 380 Million from the original scheme – which is seen across the board as a successful way of keeping disadvantaged young people in education. It found that the IFS take issue with Gove’s claims and believe them to be misleading.

» Finally, False Economy found that Osborne’s plans to reduce a £147bn deficit will increased household debt – our debt – by 245 Billion. Effectively, we’ll be footing the bill, with eye-watering interest. It seems the Baby-Chancellor will simply shift the debt from the Treasury to our credit cards. 

Cuts don’t even take effect until next month and already up to half a million people have taken to the streets in protest. Can you even begin to imagine the fallout as all of these “oversights” kick in at the same time?

Oh yes, and we’re going to force 2.2 million sick or disabled people off benefits and into work at a time of rising unemployment; cap housing benefit, potentially displacing 200,000 people; scrap the Independent Living Fund and Time Limit sickness benefits, forcing thousands of the most vulnerable in society into 100% state dependency; slash council budgets by over a quarter, privatise the NHS; close half of all women’s refuges; make it illegal to feed the homeless and triple university tuition fees.

I can’t watch, really I can’t.

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About the author
Sue is a regular contributor to Liberal Conspiracy. She blogs on Diary of a Benefits Scounger and tweets from here.
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Reader comments


Governments are incompetent.

More money for government!

You say it is astonishing that a party in opposition for 13 years should make so many mistakes.

Well, firstly, the government of today is a coalition of two parties, of which it can be fairly said the smaller did not actually expect to be in government.

Secondly, the policies of the Conservative party are not based on 13 years of preparation but more like 2-3 years of work after David Cameron took over as leader.

Thirdly, all opposition parties are hamstrung by a lack of access to government data. The government of the day protects its internal facts and figures as much as possible so any opposition can only make an educated guess about what the impact of their policies will be. In such a situation, is it really a surprise that all incoming governments always find that policies they carefull honed in opposition won’t work in government?

Finally, apart from possibly Churchill losing the election after WW2, is there any government that didn’t lose an election due to incompetence?

Ian Visits – Then surely they must slow down and get it right!! Can you honestly justify their decision to scrap BSF without checking whether contracts would be broken?

Or the Chancellor of the Exchequer not knowing even vaguely how much the Treasury receives in fuel duty – a duty he presumably just had some involvement with as he cut it in the budget?

Details. None of them seem overly concerned with getting them right and I can’t think of any government that have come CLOSE to this level of incompetence – right across the board.

Well maybe, but to include the Aircraft Carrier story here is stretching things a bit…

Excellent article, Sue. Could also mention IDS saying that his policies were based on evidence from the Office of National Statistics, and then having to admit that they came instead from a property website owned by the Daily Mail. Or Lord Freud having to apologise for making up the number of people fraudently claiming over and over again.

6. Chaise Guevara

I’m not sure we’re making it illegal to feed the homeless, outside of Westminster.

The effect of the new five year fixed term for the government will be interesting if these predictions turn out to be accurate. Years of stagnation? Sadly it’s the kind of legislation politicians find hard to reverse.

It hardly shows the kind of enthusiasm for democratic accountability the anti-AVers profess to have.

Great blog.

IanVisits @ 3

Thirdly, all opposition parties are hamstrung by a lack of access to government data. The government of the day protects its internal facts and figures as much as possible so any opposition can only make an educated guess about what the impact of their policies will be

The point being of course, that anyone with an IQ above that of a small conifer knows that and they also know that you shouldn’t attempt to draw up policies based entirely on what the headline write of the Sun and The Daily Hate write.

The problem with, for example, announcing that you intend having a ‘bonfire of the QANGOS, merely because Littlejohn lists a few of them, is that often they do an important job, even if the piss soaked Tories don’t realise it. More often than not, you are going to have to reformulate or (tsk) ‘rebrand’ that office. Similarly with other policies, reducing housing benefit is going to have long-term effects, that you have to build into the cost benefit analysis. .

All over the board the ‘ideas’ gleamed from the average nutcase who joins the Tory Party.

I have said this before and I will say it again, the Tories little more than a collection of knee jerk reactions and a pretty vile set of prejudices balled into seething mass of morons.

Okay, the sensible people who run the actual Parliamentary Party have to attempt to forge viable policies from that and they tend to make a fist of it (even if I disagree with the end result), but for fucks sake, does anyone here who supports the Tories really think pushing unemployed people to work for multi nationals for nothing is going to create jobs? Surely to fuck some of you people MUST be able to see past the rhetoric?

10. Planeshift

Another example could be the amount of times senior ministers have been caught out believing that tabloid newspaper stories are accurate. Two examples: Baroness Warsi on the “they’ve banned christmas” meme, and Grant Shapps claiming that Manchester Council had a twitter tsar, and when challenged said that he was basing this on a Daily Mail report.

Frankly anyone who believes the accuracy of the british tabloids shouldn’t be in charge of a multi-million pount budget.

Sorry about this but I’m about to deliver what could be called a soundbite – but what we are seeing now is a crisis of capitalism. Whoever is in government would find it difficult because it is the system rather than the ability to govern that is the problem.
Secondarily, we do have a particularly crap government

12. DisgustedOfTunbridgeWells

Why do you assume any of the above is considered ‘bad’ by tories?

This for example;

» Finally, False Economy found that Osborne’s plans to reduce a £147bn deficit will increased household debt – our debt – by 245 Billion. Effectively, we’ll be footing the bill, with eye-watering interest. It seems the Baby-Chancellor will simply shift the debt from the Treasury to our credit cards.

A heavily indebted frightened labour force? That’s tory gold, before you even get to the credit card companies who’ll be raking it in. A useless aircraft carrier? Brilliant, that’s the sort of shit boeing have pulling for decades and it’s seen them right.

Your notion of empirical ‘good’ or even ‘competence’ is useless when dealing with these people.

With a bit of luck, this Evil, Deceitful Coalition Government is also going to choke on its own Deceit and lies and hopefully drown in its own vomit !

In addition to what I have just said why was this Reserve Fund that is paying for the £3 Million Pound a day conflict/no fly zone in Libya not used a year or so ago to lower or pay off our deficit to stop the British Citizens suffering these deep and painful cutbacks.

Money to pay for death and destruction in other countries but no money in the pot to help our own during our financial crisis to relieve our suffering and put our country back on track.

We are all being conned and taken for a ride by this Coalition of Evil and Misery.

Sorry Sue, but your bleeding New Labour heart is showing again, let me remind you of Darlings comments, we will cut the same, we will cut as much.

I suspect you have been to council meetings like myself to hear about the council debts on school building programs, we sat in disbelief as the Council stated the 11 new schools being built in my area will in fact take two life times to pay back, reason they were built on PFI.

The debt is a monster now hanging over the councils head, but we are told another two schools will also be built using the PFI scam.

Not sure what my council will be cutting, but in my area the council tax has just gone up 3.9% with a 4.8% expected next year

Deborah Orr in the Guardian:

There will be real damage and the most vulnerable wouldn’t be the most vulnerable if the cuts were not going to hit them hardest. Indeed, one of the most idiotic things about this government is that they want to get things done very fast, before there is time for the forces of common sense (even their own common sense) to muster against them. Yet, their proposals are so often so patently misguided that only a tiny bit of determined intellectual mustering will see them off.

Incidentally, I’d add tuition fees and Cable’s screw-up over BSkyB to Sue Marsh’s list.

Orr’s right on the incompetence, even if she may be over-optimistic about defeating them.

17. Torquil Macneil

So, the government is incompetent but you want to see more, er, government? I guess the next lot will really know what they are doing,eh? The government just over the next hill.

Now then Robert, you made that quote up didn’t you?

19. Mr S. Pill

Great article Sue.

Shorter OP: Smug smug smug. Haha, Tories. After Gordon Brown’s Premiership, I find surprising anyone has the cheek to accuse the Coalition of incompetence.

21. Mr S. Pill

shorter @19

“don’t be so beastly to the Tories! *sob*”

The thing is, just saying “Oh well Gordon was rubbish” doesn’t answer any of the points. What’s more can anyone hand on heart honestly believe that GB wouldn’t have known to within 2 dec places exactly how much duty fuel brought in?

Believe me, Labour gave me plenty of head in hand moments. I do know how to spot them, I had 13 years experience!!

If I were a Tory, I’d be seriously worried about articles like this and I’d want any problems ironed out NOW before it’s too late.

The reasons for the speed are strategic. The government is hpping that in four years time they will be able proclaim success and cut taxes for the middle and upper classes prior to the election. They will not care, nor will those looking forward to tax cuts, that whole swathes of the country will be devastated by what has happened. Those swathes will be concentrated in areas already considered beyond the pale by nice, respectable people, who will be happy to judge the victims responsible for their own suffering and so dismiss them from their thoughts.

24. Chaise Guevara

@ 22

Good analysis, unfortunately.

The problem with an attack on this Government based on its perceived incompetence is that the Labour Party is uniquely unqualified to make it. Just running down some of the errors made in your list:

1. BSF – there are simply too many counter-stories of wasteful spending for this one to stick.

“One BSF school was built with corridors so narrow the whole building had to be reconstructed, another had to be closed because the doors could not cope with high winds, one was so badly ventilated additional mobile air conditioners had to be brought in during the summer and pupils were sent home.

“It is perhaps no surprise that it can take almost three years to negotiate the bureaucratic process of BSF before a single builder is engaged or brick is laid.

It’s a tough area for Labour to attack on.

2. Aircraft carriers. Are you seriously laying the blame for this on this Government? Impressive chutzpah, but since the contracts were negotiated by the last Govt, who also scrapped the Sea Harriers that could have flown off them, it’s another toughie to pin on the Tories.

3. Lower growth forecasts. I’m afraid that I don’t see Labour mounting a successful general election challenge on the basis of economic competence for a while to come. The position they left was just too disastrous. It would be like an arsonist complaining that the fire service are being inefficient.

4. Um. The Chancellor doesn’t carry the entire ONS around in his head? Shameful. Also, lame.

Ultimately, if the UK returns to moderate growth over the next few years, then Labour are stuffed. If it doesn’t then the Coalition are stuffed. Incompetence is a nice line to take for Labour (and they are being impressively on-message) but it’s not the numerous stuff ups of administration that sink Governments, it’s the big over-arching stories.

Labour handled the Foot and Mouth epidemic disastrously. Were fined by the EU over the Rural Payments fiasco. Wasted countless billions on pointless IT projects that were only begun because they were ‘sexy’. Botched the union of Customs and the IR. And it was none of these that finished them off.

26. Mr S. Pill

@24

“The problem with an attack on this Government based on its perceived incompetence is that the Labour Party is uniquely unqualified to make it.”

Is the author of the OP a LP member? Are people outside the narrow bipolar world of Westminster politics not allowed to pass comment, or something?

25 – the implication of ‘incompetence will destroy this Government’ is presumably that they will lose the next election, unless the OP is suggesting that they voluntarily step down in shame at their manifest failings.

As I said above, the result of the next election is far more likely to be decided on the UK’s economic situation nearer the time, which makes the ‘incompetence’ charge nothing more than a standard opposition accusation.

Guess that’s a ‘no’ then.

@ 25 Your dam right Mr S.Pill…the mindset seems to be ‘don’t like the current government, then you must of been a supporter of the previous lot.’ Its as simple as that to some people.

30. Planeshift

“And it was none of these that finished them off.”

It was the culminative effect though. each one knocked a few thousand votes off, then Iraq cost them about 50 seats (more if the tories had opposed it), and the support carried on falling.

I’ll try again then. This Government is not notably incompetent, on any objective interpretation of that word. It is easy to point to specific examples of Govt policies that either don’t work or, even more easily, for which you can find a prediction that they won’t work in the future. But this holds for every Government that has ever existed.

The reason I assumed this was coming from a Labour perspective was that this is precisely the ‘line to take’ that they have been pushing in interview and at PMQs for the last few months. Sorry for assuming that this iteration of a common Labour attack-line was coming from a Labour perspective.

If it isn’t and the argument is that this Govyt is so incompetent that it will collapse under the weight of its own uselessness, then it’s probably best just to agree to disagree.

There’s a broader point here about competence…The system for political apprenticeships in the three main parties is such that most MPs arrive at Westminster with next to no experience of running any large organisation. The political class is remarkably homogenous; and I fear this makes good parliamentary governance harder to achieve — at least, until Ministers have a couple of years’ experience in goverment.

33. Mr S. Pill

If this was a left-of-centre government pushing for such rapid societal change over such a short amount of time – in the face of opposition from Nobel Prize winners to Average Joe and Joanna – it would be getting compared to all manner of South American governments & worse from the frothing right-wingers who (bizarrely) inhabit this site. The fact that a “Conservative” government is in fact a government of radicals should surprise no-one who’s read their ’80s history; this government is merely continuing the dismantling of the state that was started then (& yes Labour must take some of the blame for giving succour to rightist doctrine over the past 13 years).

I fail to see why pointing out incompetance (and that’s what this is, no matter how anyone tries to dress it up as beginner’s misfortune or whatever) automatically qualifies you as wholeheartedly supporting Labour, any more than criticisms of the last Labour administration made people Conservative.

This government has no mandate for these changes – the vast majority of which were in neither party’s manifesto (not that it would matter if they were in the Lib Dem manifesto seeing as they are so willing to throw their principles out of the window) and which no-one voted for. The government should be cautious as it was “elected” on a wholly cautious vote – not the slash and burn, as fast as possible, policies it is carrying out in the face of widespread opposition. As the OP points out at least a quarter of a million people marched against the cuts before they have truly hit – things are going to get a lot worse unless there’s a significant rethink at the top. I won’t hold my breath.

I am a little surprised that the consists of slagging off Labour or picking pedantic points.

These are Government policies I don’t think anyone can dispute this – surely if this analysis is wrong then you can simply point out the holes in it?

(and if it isn’t wrong then why are you attacking it – you, who ever you are are going to be in the resulting mess too.)

@32: “this government is merely continuing the dismantling of the state that was started then”

Rolling back public expenditure levels to 2008 levels is hardly dismantling the state. Particularly when the Labour Party would do pretty much the same – though just take a little longer over it.

The national debt as a % of GDP has been higher during the Napoleonic Wars and after WW2, I believe, but it is still perilously high. More seriously, though, the UK has the worst fiscal position of any G20 country, because the Labour government was running a deficit when the banking crisis hit. In the 1970s, the UK went bust running a budget deficit of 6% of GDP; today, we are running a budget deficit of 10-11% of GDP….None of which takes account of the off-balance-sheet debts run up through PFI schemes…

Borrowing more is not an option. Taxing individuals and corporations more would be largely self-defeating (Laffer Curve, anyone?). Cancelling capital expenditure would not fund revenue spending for long. So the only option is to cut.

36. Mr S. Pill

@35

It’s not entirely about the cuts – it’s about the “reforms” that are going alongside them. The opening up to privatisation of every public service except for the security services is dismantling the state whether you choose to see it or not.

As for debts’n’deficits, I suggest you read this; http://johannhari.com/2011/03/29/the-biggest-lie-in-british-politics

37. Planeshift

Paul @32 – that’s an excellent point. The career struture really is against developing expertise. Even within the ladder from MP to cabinet minister the system simply doesn’t allow for people to learn a brief within a lenghy period of time. There is an old statistic that most ministers last less than 2 years in the job, which simply doesn’t allow time for anyone to master a brief. Its why we need more politicians coming from outside the system – frankly people should be banned from standing for election until they have at least 10 years experience in a field outside of a party position. Even then we need ways of ensuring the intake of politicians isn’t exclusively from the worlds of finance, law or journalism (nothing wrong with these industries, but we need more diversity).

I also think we need far more use of people with experience of executive office in devolved and local government. At least if you cock up running a department in a regional government there are fewer people effected. It also means when running for higher office people can point to a track record to be judged on.

As for debts’n’deficits, I suggest you read this; http://johannhari.com/

Insta-fail.

39. Mr S. Pill

@38

Wow, well done for engaging with the arguments there. *Applause*

Conservatives have a worldview.

That worldview is fixed and unbending.

The real world, complicated as it is, is made to fit to this fixed (and inaccurate) stereotype.

So Conservatives come up with bad policy time and again.

It goes on and on. A month ago ResPublica had a blog post on the same subject. It was a post about u-turns. The following was my reply, basically the reason why the government is u-turning as much as it is, is because ministers are inexperienced, they are too enthusiastic to change everything, and (in some cases) they lack the intellect to make the changes.

The issue is that we expect government ministers to have some ability. We expect them to have thought through the issues and have a good argument for their policy and a good argument against the people opposing the policy.

When the government plans a contentious policy, we expect them to consult BEFORE making the policy.

The problem with this government is that the have shown to be moving too quickly, not consulting before making policy and not thinking about any problems the policy may cause. They come across as a bunch of amateur sixth formers giving it a go for a weekend.

Let’s look at three of the policies you quote:

NHS Direct

The draft Tory manifesto said that there would be a 111 service:

“We will reform NHS Direct and introduce a single number for every kind of urgent care to run in parallel with the emergency number 999”

The problem is that after the election Lansley was quiet about what this meant. The only time that we heard about it was an off-the-cuff remark saying that NHS Direct would be closed. That was amateurish. In fact there has been no u-turn on NHS Direct. The 111 service will go ahead and NHS Direct will be allowed to bid to provide it. They many not end up being the provider in some areas. (NHS Direct is a Foundation Trust, and so it is an autonomous, publicly owned, NHS provider.)

However, do we really expect the NHS to be run by a man who behaves in such an amateur way as this?

Forest privitisation

This was a total mess by a government minister totally out of her depth. The government is allowed to sell off 15% of Forestry Commission land each year without parliamentary approval. The government had already signed off this in December. The incompetence on Spelman’s part was to try and sell off the lot.

Look at the figures. The government could sell of 40,000 ha, which at about £5000/acre represents £500m (look at the websites for companies selling woodland – most woods are £5k to £15k per acre). The government was expecting £100m, so they were expecting to depress the price with this first tranche. This incensed landowners. But where would the (preferred buyers) voluntary and community sectors suddenly find £100m? It was woolly thinking. The issue over rights of access was overblown, and most likely nonsense, but Spelman was too incompetent to be able to crush this nonsense when it was first mentioned.

Even so, the first sale of 40,000 ha could have gone through even with Spelman’s incompetent handling, since there was only limited opposition. But Spelman truly excelled in her incompetence by announcing the sale of the remaining 230,000 ha. (Sorry “consulting on the sale”, but when you read the document you see that it is actually the articles of sale, not asking what they should do with the rest of the land). The eye-popping figures (if 40,000 ha is worth £100m then Spelman was expecting over half a billion from the sale of the rest) caught the attention of the public and so the campaign started.

Frankly, Spelman was incompetent and shows a distinct lack of a grasp on reality.

Price competition in the NHS

This is the worst of the three. There is ample evidence that competition on price causes a race to the bottom and falling quality. The evidence is real and conclusive, yet Lansley forged ahead with this policy. Why? He keeps telling us that he has “spoken to more people in the NHS than any other politician” so did he actually listen? If he had asked any clinician about price competition he would be told that it is a bad idea.

Time and time again, when he was queried about price competition, Lansley claimed that it would work and when challenged his only response was arrogantly saying that the questioner just didn’t understand the policy. The problem is that as time goes on, it appears that the only person who does understand the policy is Lansley himself.

The u-turn on price competition did not come from Lansley. Instead, it came from an expert who knows how the NHS works: NHS Chief Executive (and soon to be the Chief Exec of the NHS Commissioning Board, the quango that will effectively be the Department of Health outsourced), Sir David Nicholson. Lansley would not accept that he was wrong, Nicholson, knowing that the policy was nonsense simply made the decision for Lansley.

Yet again, this shows the incompetence of the government. We expect the Sec of State to be a genius in the policy area, and yet we find incompetence, a paucity of knowledge and ability.

We expect more from government ministers. Here’s a rule of thumb, when you shout at the TV “I could do it better than you!” then you know that there is something seriously wrong with the current crop of ministers.

Tim J – This was my line, first written back in June 2010 – that the Labour party are using it makes me very happy 🙂

You say “This Government is not notably incompetent, on any objective interpretation of that word” – that’s just absolute nonsense – even members of their own party are worried and concerned at the incompetence.

It IS possible to write an article based simply on an objective look at policy you know!!

Let’s put it this way, I’ve now lost count of the number of times I’ve wished Maggie was back instead and that is a quite extraordinary comment coming from me. The one thing I CAN’T accuse her of is incompetence. She was genius. She made sure every minister had every angle covered before she attempted ANY battle. That’s why Labour couldn’t gain much traction for so long.

Opposing Cameron is like opposing a rather poor local youth football team. There are so many open goals, it’s almost too easy.

“Frankly anyone who believes the accuracy of the british tabloids shouldn’t be in charge of a multi-million pount budget.”

Or a pair of shoes.

#2. IanVisits

Secondly, the policies of the Conservative party are not based on 13 years of preparation but more like 2-3 years of work after David Cameron took over as leader.

while I accept what you say about coalition, the fact is, Lansley’s Health and Social Care Bill is his bill, it is NOT a coalition bill. In fact, he’s even broken the coalition agreement (where’s the lilly livered LibDems? Why can’t they insist that the coalition agreement is followed? Oh yes, the simply like it too much snuggling up to their new friends).

Lansley, famously, has met more people in the NHS than anyone has ever had hot dinners. In fact, I am sure if you press him, he will tell you that he knows every one of them personally, and every one of them fully supports him. Yet he has still managed to produce an absolute dogs breakfast of a bill which the professions do not like, the unions do not like and the public do not like. That is pure and utter incompetence. You cannot blame coalition for that.

You can, however, blame Danny Alexander. He reviewed it at the end of last year along with his new chum Oliver Letwin, and the two both signed it off. If the bill is delayed, heavily amended by the government, savaged by the Lords, or simply dropped altogether, the blame of the immense waste of time on it will be placed on Alexander. Chop, chop, chop come the post-local election cabinet reshuffle.

39 – that’s the article where Hari originally claimed that Govt policy was to “pay off our debt rapidly” even though debt will increase every year of this parliament (although I note this has sneakily been edited now)?

And where he claims that Herbert Hoover responded to the Wall Street Crash by cutting Government spending?

And where he notes that UK debt was higher when Atlee started the NHS, but doesn’t observe that he was running budget surpluses at the time?

And where he notes that debt is historically not high, but doesn’t mention that the deficit is at its highest peacetime level ever?

And where he praises South Korea’s deficit spending – currently is running at 1.66%?

When Hari does get something right, it’s only ever by accident.

@25 Tim J

“2. Aircraft carriers. Are you seriously laying the blame for this on this Government? Impressive chutzpah, but since the contracts were negotiated by the last Govt, who also scrapped the Sea Harriers that could have flown off them, it’s another toughie to pin on the Tories.”

Mental as the last government were, it took the Coalition to turn a drama into a crisis with their monstrously ill-judged Strategic (?) Defence Review. For information, you don’t need Sea Harriers for aircraft carriers, ordinary Harriers will do as proven by the RAF as well as the USMC, Spanish and Italian experience.

http://www.defencemanagement.com/news_story.asp?id=14680

The craziest decisions were to scrap Ark Royal early leaving us with no carrier based capability until the JSF equipped carrier is ready, and the decision not to make both “new” carriers operational. Five will get you 10 at some point in the future, the sole carrier we have will be in for a refit at some vital crisis point.

So yeah… Labour’s legacy may be pitiful, but the Coalition have compounded the problem by a rushed and ill-considered defence review which makes us less secure and will probably end up costing us money.

So the OP was pretty much on the money on this one.

The one thing I CAN’T accuse her of is incompetence. She was genius. She made sure every minister had every angle covered before she attempted ANY battle.

It’s lovely of you to say so, but it just ain’t so. There were u-turns and policy foul-ups aplenty in the 1980s. Just as there were in the 90s, 70s, 50s and any other decade you can name.

48. AnotherTom

That Hari article is the worst article about debt I have ever read. It’s a clusterf*ck of errors.

@36:

“The opening up to privatisation of every public service”. Privatising the delivery of services is not rolling back the frontiers of the state, as the state still picks up the tab and sets the specification for the service. It usually reduces the number of people on the public payroll; and (if the public servants managing and letting the contract know what they are doing, which they may not!) it generally provides the taxpayer with better value for money. (I speak as a former civil servant tasked with out-sourcing or privatising.)

As for Johann, he’s good on gay rights and many social issues; but he’s down there with Richard Murphy on fiscal/economic policy…

Four brief points in response to JH’s article:

1. JH does not seem to understand the difference between the national debt and the budget deficit. You can run a large national debt; but only if you have near-balanced or in surplus budgets!
2. The figures for the national debt do not include the scandalous amounts of money that the Labour government burdened future taxpayers with under the PFI schemes. Some estimates indicate that the PFI’s double the national debt, though admittedly we are not servcing that debt yet.
3. JH’s understanding of the Great Depression is lamentably superficial. Keynes’ General Theory was not published until 1936(?); and Keynesianism was not established until the 1950-60s!
4. Krugman is no fool, and I don’t deny he has a point. But the markets have received the Coalition’s measures favourably. And JH’s comparison with the euro-countries is utterly misplaced! Of course, the PIIGS are in trouble, as they cannot devalue to boost growth by exports and tourism e!!! Thank God, Gordon Brown, for all his other incompetencies (including selling off the gold reserves at the bottom of the market!), had the bloody-mindedness to keep the UK out of the Euro!

Meanwhile, I must repeat…the UK has the worst fiscal position of any G20 country, because the Labour government was running a deficit when the banking crisis hit. In the 1970s, the UK went bust running a budget deficit of 6% of GDP; today, we are running a budget deficit of 10-11% of GDP!!!

Sorry, but a country just cannot do that! It is utterly unsustainable! If Labour had been re-elected, I suspect the markets would have forced them to do pretty much what the Coalition is doing now.

Mr S Pill,

Wow, well done for engaging with the arguments there. *Applause*

Well, c’mon, it’s analogous to “how can you tell when a politician is lying?” – how can we tell when Hari gets something wrong?

But if we must…

As for debts’n’deficits, I suggest you read this; http://johannhari.com/2011/03/29/the-biggest-lie-in-british-politics

Clicks through:

“Here’s the lie. We are in a debt crisis. Our national debt is dangerously and historically high. We are being threatened by the international bond markets. The way out is to eradicate our deficit rapidly. Only that will restore “confidence”, and therefore economic growth. ”

That’s the last time deficit is mentioned in the entire piece. He bangs on about debt. He says the debt is not the highest – and it isn’t. But it is the deficit which in May 2010 the Guardian said “is rapidly becoming one of the worst” and they helpfully supplied a link to OECD debt and deficit data. It is our deficit that was in fact the worst in 2010 – worse than Ireland, Greece, Spain, Portugal. It’s our deficit that is historically high (those figures go back to 1960). And it’s the deficit Osborne (rightly or wrongly) keeps saying we need to reduce.

“But to claim that this crisis was caused by Labour “racking up debt” is simply false. When the Great Crash hit, Britain had the second-lowest debt in the G7 club of leading economies.”

If he means the financial crisis that started circa 2007, not the Great Crash of 1929, we didn’t have a high debt (relatively speaking). But we did have a high deficit – worse than Portugal, Italy and Spain. The claim is that Labour racked up a record deficit.

A party has 350 MPs. It must fill a hundred or so government posts, at least 20 of them at the highest level. Of the 350, perhaps 150 are too eccentric, extreme, stupid, drunk or just unambitious. This leaves 200 in contention for 100 posts, i.e. an average shortlist of two. Ho ho.

The fact that the pool of talent is extremely small is evident from the procession of ill-informed incompetents that passed through the cabinets of the Blair/Brown era. Sadly no electoral system can guarantee even moderately competent government…

I reckon the Tories do have a well-thought-out strategy all the same, and that is to destroy the structure of the state so comprehensively that even if they lose the next election there will be nothing at all that a new government could do to put things right.

@42 Sue Marsh

“She made sure every minister had every angle covered before she attempted ANY battle. ”

You think….? How about the Poll Tax?

Ohhh yes, the aircraft carriers. My friend is a great Conservative who writes (among others) for the Telegraph and Economist.

Sure, they’re not thrilled that the original contracts were so tight they couldn’t be cancelled, but I assure you Sunday lunch is a start-to-finish rant at the Strategic (?) Defence Review. The aircraft carrier dabacle infuriates him so much it makes your ears bleed just listening.

If the Conservative’s own ministers, grassroots members and MPs are furious at any incompetence it is this. You might notice I didn’t add Hague to my list of incompetence, though you might think Libya had given me cause. I think in fact Conservatives are SO furious with Hague over the SDR that they are briefing against him.

Shame, because I felt he was one of the few “safe pairs of hands” in the government.

54. AnotherTom

@50 the reason why he talks about debt is because he made a Very Big Error and thought debt = deficit. So his article, in GQ I think, is completely wrong. But in the version online he’s switched debt for deficit, but as you highlight the article’s based on it being about debt rather the deficit.

If we ever needed a more eloquent demonstration of how little Hari knows about finance, but how keen he is to make his voice heard …

planeshift @ 37:

“we need ways of ensuring the intake of politicians isn’t exclusively from the worlds of finance, law or journalism (nothing wrong with these industries, but we need more diversity).

Exactly. You put it rather better than I did. Thank you. Though I’d add management consultancy, SpAd-dom, political research, PR, estate agency, lecturer, etc to your list, if you don’t mind.

Whatever happened to the captains of industry, the senior trade unionists, the farmers, the public sector professionals? (Think, for example about the WW2 Cabinet, and how Churchill’s creativity and inspirational leadership were complemented by Attlee and Bevin’s management skills.)

Today, the front benches have very little practical or management experience of anything outside of politics.

How and why did we allow our political class to become professionalised and homogenised?

Rant over. Answers on a postcard…

My favourite Hari column was the one where he castigated the Coalition Govt of 1918/19 for being so stupid as to slash public spending as a reaction to an economic crisis.

He didn’t consider that the reason for the dramatic fall in public spending after the end of the First World War might, just conceivably, have been related to the end of the First World War.

http://www.independent.co.uk/opinion/commentators/johann-hari/johann-hari-a-colder-crueller-country-ndash-for-no-gain-2112069.html

That was also the article where he bewailed the forthcoming 20% cut in public spending, which must have been a shock to a Treasury forecasting a 4% cut over 4 years. He knows practically nothing about history or economics.

57. Planeshift

“How and why did we allow our political class to become professionalised and homogenised?”

That question is probably a phd thesis by itself, but I suspect a great part of it is down to the creation of new labour and the slow eradication of MPs with minds of their own. In the mid 90s they were shit scarred of anything that would put off middle england voters, and so old left wing MPs with a background in industry were slowly retired and replaced by more disiplined blairites. The same thing happened to the tories in the middle part of the last decade when old right wingers with a tendancy to say homophobic things were pushed out in favour of people trying to look modern. They basically adopted strategies based upon the idea that people vote for parties not people, and thus needed to minimise the damage done to the ‘brand’. (The irony being that independant candidates like Martin Bell and Richard Taylor demonstrating the opposite).

Plus I think you also have to ask this; why would anybody who had risen to the top ranks of their position consider going into politics? The salary of an MP is lower than that of many senior positions, and it’s actually a rather shit job being a backbencher. You can look forward to constant scrutiny of every aspect of your life (do you have a strange or unusual hobby? enjoy kinky sex? have a weakness for drink? – say goodbye to doing anything interesting in your life….), and half your correspondance as an MP is probably going to be coming from the tin foil hat wearing brigade or organised campaigns. Plus the only realistic opportunities for career progression involve kissing arse whilst you climb the ladder.

58. AnotherTom

@56 lovely stuff. I liked his misreading of a months-old FT article which led him to claim that ‘most economists’ think banks’ capital ratios should be 30%. /bankanalyst joke

THE NATIONAL DEBT IS DISTINCT FROM THE BUDGET DEFICIT:

ukliberty @ 50 puts it very well:

“But it is the deficit which in May 2010 the Guardian said “is rapidly becoming one of the worst” and they helpfully supplied a link to OECD debt and deficit data. It is our deficit that was in fact the worst in 2010 – worse than Ireland, Greece, Spain, Portugal. It’s our deficit that is historically high (those figures go back to 1960). And it’s the deficit Osborne (rightly or wrongly) keeps saying we need to reduce.”

I’m not unsympathetic to the public sector. (My wife is a senior local government officer; and I’m a former civil servant.) But deficit deniers please note: …the UK has the worst fiscal position of any G20 country, because the Labour government was running a deficit when the banking crisis hit. In the 1970s, the UK went bust running a budget deficit of 6% of GDP; today, we are running a budget deficit of 10-11% of GDP!!!

SO SERIOUS CUTS MUST BE MADE!

60. Luis Enrique

inally, False Economy found that Osborne’s plans to reduce a £147bn deficit will increased household debt – our debt – by 245 Billion. Effectively, we’ll be footing the bill, with eye-watering interest. It seems the Baby-Chancellor will simply shift the debt from the Treasury to our credit cards.

for that literally to be true, as written, we’d need to see something like the government taking something that was previously provided by the state – say, medical care – turning it into something that we have to pay for privately, and then households choosing to do so buy increasing their borrowing rather than buying less of something else. At least, that’s the best sense I can make of it. Then we would be “footing the bill” for the cuts, and debt would be shifted from the Treasury onto us.

Is that what’s happening? In general, holding investment constant, anything that involves the state borrowing-and-spending less will involve the private sector borrowing more – as Chris Dillow is always pointing out, private sector saving is the counterpart of public sector debt.

So, why has the OBR increased its household debt forecast by £245bn? If households become more optimistic, they might borrow more, so higher debt could be consistent with economic recovery. If the government was to raise taxes on banks, corporations and the wealthy, that could see them saving less (hence consistent with higher aggregate household debt too). I’m not suggesting either of these are what’s happening, I’m just pointing out the reason behind the OBR’s changed forecasts is not obvious, and it’s not obvious how Osborne’s plans to reduce government debt are causing increases in household debt.

I’d like to know where the OBR think that extra borrowing is coming from – whether it’s rich or poor households, and what it’s beings spent on.

(oh, government debt is still “our debt”, by the way)

61. Luis Enrique

sorry, to be clear, I don’t mean to argue that Osborne’s policies are not somehow responsible for the increase in debt. Only that it’s perhaps not as obvious as it appears.

Ah but Galen – she’s lost the plot by the poll tax riots. Took til 1990 though – 11 years!!! It’s taken this lot 10 months.

Tim J @ 56:

“He knows practically nothing about history or economics.”

Indeed: many on LC could do better!

Actually, someone just pointed out the good old debt’deficit trip-up in this too.

I say that Osborne will cut the deficit by transferring it to our credit cards – of course he wont (even when aware of the defict/debt distinction it’s still easy to trip up). Nonetheless, private debt increasing to that degree can ONLY be down to the fact an already highly indebted nation will be feeling the squeeze. Those in debt often end up using credit cards or other debt to pay the initial debts (ie mortgages).

OR they can’t afford bills AND food so the food and school uniforms etc all start to go on the credit cards.

LE @ 61 and 60:

“sorry, to be clear, I don’t mean to argue that Osborne’s policies are not somehow responsible for the increase in debt.”

But how exactly are Osborne’s policies responsible for a (projected!) increase in personal debt? Putting aside mortgage and student debt, consumer debt is a lifestyle choice. People can rein in their expenditure; people can even live within their means — but no-one will starve.

paul ilc – you’re kidding me right? Do you honestly know that little about private debt and why it occurs? Do you honestly think it’s all plasma screens and holidays???

“No-one will starve” Huh? Say what? Are you SURE???? Sure no-one is starving already, let alone when the cuts really take effect? I assure you many sick and disabled people are very close to starving – either because they can’t afford food or more likely, because care has been cut to the degree that there is no-one to cook it for them or deliver it to them.

What a staggeringly out of touch comment.

I think the problem is the Conservatives came into government with a load of talking points swirling around in their heads. It is all to be expected that oppositions will make stuff up or at least be cavalier with facts. However, to govern requires one to deal with a more complex world and the Conservatives appeared to believe their talking points. Therefore, you get u-turn after U-turn as talking point world meets reality.

I would not be so sure that the electorate will just forget by the time of the next election. Mr Major never recovered from the debacle of the ERM, despite the economy doing well in 1997. Normally the incumbent government get judged on the state of the economy at the time of the election. However, there are exceptions. Moreover, the Conservatives have to increase their votes not just minimise losses.

Inexperience of running large departments is no excuse. The civil service run the departments with the politicians directing policy.

Not having access to government figures before taking office is not true. The opposition get access to the Treasury and BoE in the six months before an election, that is all they need as the rest is stamp collecting. The economy and borrowing was doing better than forecast by the Treasury the previous year so ‘ things were worse than we expected ‘ will not wash.

There just does not appear to be a coherent plan other than deficit phobia and the impression I get is they are making it up as they go along. Pissing off North Sea oil operators and losing tens of billions of investment for a cheap headline knocking 1p of fuel is no growth strategy. They would like us to export more and rely less on private consumption for growth. Absolutely no one could possibly disagree with that aim. However, there is no coherent plan how they are going to achieve an export-led economy. On the one hand they are trying to be radical to tick boxes for the Tory base. However, in every sector what they come up with is inadequate and completely lacking in ambition. The country’s infrastructure is falling apart. How about just fixing the bloody roads.

@45

You claim that we have the highest peacetime debt in history. Have you forgotten that we’re fighting a war in Afghanistan, only recently finished fighting one in Iraq, and have just started fighting another in Libya?

And why do so many right wingers keep repeating this claim? Are they all liars, or do they genuinely believe that we haven’t been fighting at least one war throughout the last decade?

69. Luis Enrique

Sue,

I dearly hope we’re not going to see an extra £245bn borrowed on credit cards! I’m not sure a figure that large can be explained by changes in the behaviour of poor households who are perhaps already in debt, having to pay for food, school uniforms, because they’ve somehow suffered from the cuts, perhaps having lost their jobs and not found work again. How much extra borrowing do you think such households can take on, to add up to £245bn? We should also consider changes to saving behaviour in rich households.

What do you mean by “feeling the squeeze” – do you mean higher price inflation relative to wage inflation? First, households experiencing lower real incomes don’t necessarily respond by borrowing more – some will, others will cut spending. Second, is Osbourne to blame for that squeeze? If he increased government spending, like us lefties want him too, wouldn’t that also be inflationary? If the BoE raised interest rates to try to tame inflation, wouldn’t that make matters worse, increase “the squeeze”?

Paul – I don’t have an answer – I’m not really comfortable telling stories about the possible macroeconomic causal chains, there are too many and I get confused too easily. Sue on the other hand knows it can only be because of Osborne, so ask her. She may well be right.

really, I ought to go and read the OBR report in which they no doubt explain their reasoning

@65 & 66

Household debt increases if people just pay less towards their existing debts. When households or firms pay down part of their debts that is counted as saving. During the recession when the savings rate increased that was people paying off more debts than new debts were accruing.

And why do so many right wingers keep repeating this claim? Are they all liars, or do they genuinely believe that we haven’t been fighting at least one war throughout the last decade?

It’s really a short-hand for ‘highest deficit that is not explained by the fighting of a total war that took up the overwhelming majority of public spending and led to conscription and state economic control’. That’s a bit of a mouthful, so people tend to use ‘peace-time’ even when that period covers the Korean War, Falklands War, Iraq War or Malayan Emergency.

You claim that we have the highest peacetime debt in history.

Oh, and I don’t claim that it’s the largest peacetime debt in history. That’s more or less the whole point of the post. Deficit =/= Debt. Write it out a hundred times before tea. Tsk.

The tories may have been in opposition for 13 years but they have not changed one jot. Effectively it is warmed over Johnny Major that we are getting.

Nobody with a brain thinks the tories were ever going to change. They are, and always will be the party of the rich.

74. AnotherTom

I’ve scanned through the OBR report and there’s no qualitative analysis that supports the claims made by Sue and Duncan here about Osborne forcing people to borrow more. What it does clearly identify is that higher inflation than expected has led to a downgrade in growth.

This seems to have somehow been translated into blaming Osborne for maxing out the UK credit card, which is something of a leap.

My interpretation of some of figures is very roughly that the UK household has actually yet to slow spending and so in an environment of flat GDP growth, corporates ‘saving’ (ie repaying debt) then household debt will almost inevitably rise.

However, these are just one set of forecasts from one set of (admittedly authoritative) economists, so I’m yet to mount the barricades.

““No-one will starve” Huh? Say what? Are you SURE???? Sure no-one is starving already, let alone when the cuts really take effect? I assure you many sick and disabled people are very close to starving – either because they can’t afford food or more likely, because care has been cut to the degree that there is no-one to cook it for them or deliver it to them.

What a staggeringly out of touch comment.”

Sue, I work for charity helping elderly and disabled people (contracted to County Councils), and I am as sure as I can be that no-one I deal with will starve (or even suffer unduly, except from the unfortunate anxiety about change). — And if any of the folk for whom I care tell me they are really suffering, I will be among the first to ring the alarm bells! — I suspect you have an ideological axe to grind: I can only speak from experience; but most people will simply live within their budget.

That said, I have had severely disabled people living in our schemes who have cancelled their standing order – quite deliberately!! – in order to spend more on mail order. I have disabled/elderly people who have simply defaulted! I have had elderly immigrants who have defaulted on rent (and been evicted legally) and then turned up in an ambulance demanding to return! I have had sons/daughter pleading mum/dad’s poverty in order to save their inheritance…My point is that we live in a very rich society: most people can absorb the cuts, I think…

Luis – “I’m not really comfortable telling stories about the possible macroeconomic causal chains, there are too many and I get confused too easily.” Thank you for your honesty. And neither am I; and I don’t have your evident economic expertise. But, down here at the coal-face, I see that the elderly and disabled are re-jigging their budgets with little pain. But my tip is to watch out for Housing Benefit expenditure to increase!

Luis/Sue: As to individual debt, I can only speak from my experience with a particular sector of the population. However, the Duncan Weldon/Sue figure is an OBR projection. I have not read the report; but I do wonder about its accuracy and assumptions about human behaviour. My hunch is that people (the underclass excepted) might well re-trench and re-prioritise – spending on what is necessary and reducing debt. If so, this might be a turning point for the UK economy, away from consumption to production and exporting….But I’m not holding my breath…Cameroon-Millipede, I fear, will aways prefer to bribe the electorate with their own money…

@68 If said right winger’s house is not under threat of being bombed, then clearly we mustn’t be at war…

In other news, Sally claims to have a brain:

“Nobody with a brain thinks the tories were ever going to change.”

” I work for charity helping elderly and disabled people ”

Is that like Peter Lilleys famous French Neighbour that turned out not to exist?

No, ‘Sally’, I’m genuine. And, day to day, I have to deal with very, very vulnerable people — most of whom are in need of our services. But I also have to deal with many people who are trying to play the system and who are frankly scrounging! Sorry; but that’s the reality.

Wow! Paul ilc – I most certainly do have a story to tell.

I’m sure Sunny won’t mind if I beg you to read this : http://diaryofabenefitscrounger.blogspot.com/2011/01/nowhere-to-turn-for-vulnerable.html
If you think it is hyperbole, please just spend a moment or two googling ESA Work Capability Assessment tests, ATOS, or Scrapping DLA. Call it research, please? Just for me?

The sick and disabled network on line have been campaigning very hard to highlight these issues and I can assure you 100%, that people are going to starve. They’re starving already.

If you combine all the cuts sick and disabled people are facing, they will lose roughly a third of their income. This is a group who already live in poverty more than any other (up to 70%)

I am sick myself, but I’m spending every waking moment engaging with ministers on this issue and they are starting to hear. People, I assure you, are going to starve if they don’t.

“If you design a system purely aimed at catching cheats, you will simply make the truly needy suffer more and more. If you design a system designed to genuinely help and support those who need it, you will find the cheats.”

80 – Sue

Could you please show an actual, real life, named (disguised, obviously) example of someone losing 30% of their benefits, and then starving. Please give the figures.

Thanks.

83. Teddy Groves

About debts/deficits, I don’t see why talking about the deficit is relevant. Intuitively it seems pretty obvious that what matters for credibility etc is the total level of debt, not its rate of change. Greece/Ireland/Spain are having crises because their governments are highly in debt, not because they are increasing their debt quickly, right?

It seems at least possible to me that the ones who are really trying to conflate debts with deficits are the those who try to scare people with silly ‘higher deficit than Greece’ comparisons, not those like Johann Hari who just don’t like wasting time talking about things that are beside the point.

Can someone please explain why a historically high deficit is a bad thing if total debt levels are not that high?

Max – I can do better than that – I can show you a video. http://onemonthbeforeheartbreak.blogspot.com/2011/01/fit-for-work.html

What’s more, I will lose ALL of my benefits under the changes – £4661 a year in one change alone. It will bankrupt us.

Now I’ll stop taking over the thread with my own issue, so forgive me if I don’t reply any more 🙂

84 Sue

Please explain how you will lose this money under the changes. Has this been confirmed? I honestly don’t understand.

Thanks

Deficit ? borrowing ? increasing debt ? rising interest payments ? drain on tax revenues ? less available for other areas of public spending. Same thing happens in household budgets, except that governments can quantitively ease more money into circulation, with possible inflationary consequences. Spending cuts + tax increases are needed, but both can have perverse effects. The trick is to maximise the extraction of goose feathers while minimising the hissing.

87. Charlieman

@57 Planeshift: “That question is probably a phd thesis by itself, but I suspect a great part of it is down to the creation of new labour and the slow eradication of MPs with minds of their own.”

I suspect that New Labour was a minor factor in the creation of professional politicians who are not MPs but wish to become MPs. But as you say, it is a subject worthy of academic study.

The progress route from NUS President to professional politician has its roots in the 1970s. The same can be applied to other NUS and local SU sabbaticals. Many who opted out of electoral politics gained influence by becoming party advisors, political journalists or lobbyists.

Political party youth wings have always been a step towards full time party employment. Youth wings pay modest expenses to volunteers; it is inevitable that many who progress will come from a middle class background. Of course, it takes more than a sabbatical allowance to survive as a student union politician too.

The economic and political circumstances of the 1980s created a wave of professional politicians in local government, particularly on the left. Local government expenses at the time were modest — £10 or so for attending a meeting — so some councillors were appointed to almost every sub-committee. Ten quid here, ten quid there, the dole everywhere plus donations allowed a few youngish men and women to become full time councillors, living on a very modest income. Others obtained sinecures at neighbouring councils that permitted them to work full time on their own turf.

The role of full time councillor has been acknowledged in recent years. The allowance in big councils can substitute for a wage, but few councillors will get rich. In theory, generous allowances allow councillors to conduct their jobs without financial worries; in practice, “full time councillor” allows a lot of opportunities for self promotion.

But the biggest change came from 1960s and 1970s social mobility. The 1997 New Labour intake were largely middle class; LibDems are almost always middle class. But it isn’t economic class that matters. The problem with the 1997 intake was that they came from the statist class. If they weren’t a professional politician already, they were employed by government or another hierarchical organisation.

Politicians who rise through the ranks by SU, youth wing or local government will become worn down to the idea that something must be done and that government should do it. Ex-government employees are trained to believe in processes; if the process fails, there must be a better process; statism and managerialism.

The presence of a new breed of public schoolboys at the top is an anti-historical phenomenon. Anachronism. And it doesn’t matter because the back rooms are occupied are still occupied by statists.

@79

No, ‘Sally’, I’m genuine. And, day to day, I have to deal with very, very vulnerable people — most of whom are in need of our services. But I also have to deal with many people who are trying to play the system and who are frankly scrounging! Sorry; but that’s the reality.

Well maybe that is the reallity in Daily Mail land where you obviously live. But in the real world, levels of benefit fraud are actually pretty small. My source for this claim? Well the governments own estimates actually:

http://liberalconspiracy.org/2010/10/23/the-dwp-suggests-osborne-is-exaggerating-benefit-fraud/

http://liberalconspiracy.org/2010/08/10/1-the-real-extent-of-benefit-fraud/

In the real world, people with pretty serious disabillities are being cut off from benefits because the entitlement criteria has been drawn so rigidly as to make virtually impossible for anyone who isn’t a paraplegic to get ESA.

http://www.guardian.co.uk/society/2009/oct/28/work-capability-assessment-incapacity-benefits

Or if you want further damning evidence then try downloading this report from the Citizens Advice Bureau:

http://www.citizensadvice.org.uk/not_working

Teddy Groves @ 83:

“Can someone please explain why a historically high deficit is a bad thing if total debt levels are not that high?”

The deficit is the loss we are running each year on the national government account, and it is at very high levels.

The national debt is the consolidated sum we owe as a nation. At present, the UK’s national debt is not particularly high historically —- but only as a % of GDP!!. Yet, when you take into account PFI debts (which are off balance-sheet), it is colossal!

Returning to the annual budget deficit, the UK has the worst fiscal position of any G20 country, because the Labour government was running a deficit when the banking crisis hit.

In the 1970s, the UK went bust running a budget deficit of 6% of GDP; today, we are running a budget deficit of 10-11% of GDP!!!

As a nation, we are living beyond our means. And even the most savage retrenchments in military spending are not going to change that!

Sue @ 80, 81 & 84:

My anecdotal evidence vs. your rhetoric; but I’m in the front line of service delivery, while you are speaking personally. And, from here, I see no evidence at all that disabled people will starve! You should be deeply ashamed of yourself for making this claim without putting forward hard, budgetary evidence. There is no reason for any local or national agency to let anyone starve, least of all the disabled. But, as the UK sinks down the economic league, the culture of entitlement will surely come to an end; and we will all have to do more for ourselves.

Graham @ 88:

You are confusing benefit fraud with attempted benefit fraud. Obviously, the former is a lot higher than the latter: public servants and contracted agencies screen out a huge number of attempted frauds! As do I and my staff!

We could spend 100% of GDP (or even more if we borrowed even more!!) on helping the disabled (or any other group), but there would still be unsatisfied layers of ‘need’ (compare and contrast the the ‘onion’ theory of the NHS).

But the UK is almost broke, and yet the disabled are still being cared for at a high level. Perhaps not as high a level as they might feel ‘entitled’ to; but a decent level.

Funny, one would think it was those starving the sick or disabled who should feel ashamed.

Illustrates just how topsy turvy our world has become.

If you saw my link, you can’t possibly conclude that people are being cared for well.

93. Charlieman

@9. paul ilc: “Yet, when you take into account PFI debts (which are off balance-sheet), it is colossal!”

I’ll forgive you for the unnecessary exclamation mark.

Paul Foot and Private Eye wrote a series of damnations of PFI. Paul Foot was a Trot and Private Eye is a contrary publication; on occasions both have really fucked up; neither fucked up when talking about PFI.

The primary argument for PFI is that we do not trust ourselves to run things; government will pay a company to run a project; and everyone denies everything.

Everything is so fucking big that you cannot nail the fool that said “do it”.

Make everything small.

94. Teddy Groves

Paul ilc @90

Thanks for replying but I can’t really find an answer to the question of why a high deficit without high government debt is something to worry about.

If government debt is actually much higher than it seems thanks to PFI etc. then that something to worry about, but it is a bit of a separate issue as I think you note.

“At present, the UK’s national debt is not particularly high historically —- but only as a % of GDP!!”

I think the idea is to estimate how likely the government is to repay its debt. Since ability to repay is roughly proportional to GDP, it makes sense to measure debt levels like this.

“The UK has the worst fiscal position of any G20 country, because the Labour government was running a deficit when the banking crisis hit.”

This is a pretty controversial claim: I think most people would dispute whether the UK has such a bad fiscal position and whether the cause was really one year’s government spending and not longer term factors. Even if the claim is true, this still doesn’t answer the question: why are high deficits bad? Is is only because they make countries especially vulnerable to financial crises?

“In the 1970s, the UK went bust running a budget deficit of 6% of GDP; today, we are running a budget deficit of 10-11% of GDP!!!”

You’ve assumed that it’s obvious that high deficits cause countries to go bust, but that is exactly the question: why?

@Paul ilc

In the 1970s, the UK went bust running a budget deficit of 6% of GDP

But Britain didn’t “go bust” in the 1970s. I assume by that you are refering to the IMF loan in 1976. Which in fact turned out was not actually needed, and most of it was not used. The entire loan was paid back in full by 1979.

Here’s some informed facts about defecits/national debt etc.

http://www.ifs.org.uk/bns/bn93.pdf

97. AnotherTom

The original post contains a glaring logical flaw which is worth pointing out. The piece implicitly suggests this government is unusually incompetent and this is something particular about its ideology. From the comments, it’s pretty clear how someone with her ideology would think such a thing, but being self-righteous doesn’t make someone right.

The previous government was quite awesomely incompetent in lots of damaging and expensive ways. I could list them, but it would be a very long list. And I don’t even have to mention the bank crisis. How about tube PFI? Wow what a f*ck up. How many billions have we wasted on that now? How about defence procurement? Another load of wasted billions. Or government IT contracts? There was quite stupendous waste of money. (Was it £11bn chucked down the drain?) Or the colleges rebuilding plan, which was a complete f*ck up.

I could go on. So, Sue, do you care about these? Or is politics about about winning your narrow tribal argument?

Does anyone know what proportion of public spending and tax receipts is eaten up by interest payments on the national debt – and what the trends have been and are projected to be?

99. Richard W

@ 98. Jonathan Phillips

This is out of date but the pie chart is a good illustration of the various scales of actual government expenditure.
http://en.wikipedia.org/wiki/File:UKExpenditure.svg

A more up to date forecast can be found in the latest OBR report.
http://cdn.budgetresponsibility.independent.gov.uk/economic_and_fiscal_outlook_23032011.pdf

Who holds our outstanding stock of gilts
http://av.r.ftdata.co.uk/files/2011/02/Gilt-holdings-IFS.jpg

What one needs to remember about the government interest bill is it is a gross figure. Interest payments are taxed so the gross figure is not an accurate reflection of the cost to the government. Moreover, currently around one fifth of the interest payments are paid to the Bank Of England who being publicly owned pay it back to the Treasury at the end of the financial year.

Members of the Coalition are fond of (programmed) telling the public that the interest bill is bigger than X Y Z government budget. As one can see the figures that they are using are not accurate. They are attempting to scare the public and the impression that they want to give is interest payments are dead money that disappears into a black hole never to be seen again. Interest payments are mostly a transfer to the pension funds and insurance companies who then make payments to their pensioners and annuity holders. There is no black hole. We do make interest payments to the rest of the world who have significantly increased their gilt holdings. I would prefer if we did not rely on the ROW to finance the government. However, the ROW sees us as a relatively safe place to park their money so there is not much we can do about that. Moreover, even payments to overseas holders are paid in sterling so can only be used to purchase other sterling goods, services and assets.

99 Richard W – brilliant, thanks. One problem is that in the national economy everything is connected to everything else, sometimes in unexpected ways. Household budgets are much more linear, with few feedbacks. Few politicians seem capable of understanding this, even fewer of knowing what to do about it. G Brown’s claim to have conquered the business cycle was among the daftest things any politician has ever said.

101. Richard W

Indeed. They all go mad after about eight years in high office and start believing their own BS.

Hahaha, another Tom. I’m writing for Liberal Conspiracy, I’m a Labour activist, so yes of course I have an opinion, but you totally ignore my list of points in the article.

It’s been 10 months!! 10 Months!!

I suspect from your list of “incompetence” that you are locked in a “narrow tribal argument” too.

As it happens, no I don’t really care about any of the things you listed. They didn’t stop me buying food or stop young people getting an education or stop elderly people paying their bills. I don’t think Labour produced many policies so glaringly full of holes. The thing is, it doesn’t matter what I think, it matters what the public think and they seem to agree with me. I wouldn’t quite say we were at the “Oh God what have we done” stage yet, but polls show you are damaging whatever fragile trust you tried to build in your brand daily.

You lot really do have to stop looking back at what Labour did or didn’t do. You’re in government now, not us and if you behave like spanners and produce spanner-ish policies, it’s now our job to point it out.

That there is SOOO much to point out is great, but why not argue why the list I wrote is not incompetence? Or do you agree that it is?

103. anonyperson

“As it happens, no I don’t really care about any of the things you listed. They didn’t stop me buying food or stop young people getting an education or stop elderly people paying their bills.. You lot really do have to stop looking back at what Labour did or didn’t do. ”

The above is one of the most ignorant comments Ive ever seen made on this site. Isnt it grand that under Labour *you* didnt suffer a lack of food, education, or had problems paying your utility bills.

Labour had lots of money and time to make it so that we could all be so smug, but they chose not to. I had problems with all three of the above under Labour.

This is why I cant take any of the Labour and/or anti-cuts people seriously. They want things to stay the same because under that system they were all doing all right jack. Fuck everyone else who it wasnt working for.

@98

According to this: http://www.guardian.co.uk/business/2011/apr/03/private-benefactors-wont-be-enough-to-balance-the-books

Interest payments on the debt add up to about 3.5% of GDP. About the same as they were in the last years of the Major government.

Furthermore, as a large percentage of the debt is held by UK residents. A lot of the debt payments are recycled back into the UK economy.


Reactions: Twitter, blogs
  1. Liberal Conspiracy

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  2. Crimson Crip

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  3. Anthony McGarr

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  12. Dr Eoin Clarke

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  13. John H

    This @libcon piece contains yet another of those debt vs deficit elision that @langtry_girl has trained me to spot… http://bit.ly/fZPzek

  14. Mike Wilson

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  26. Double.Karma

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  36. Megan

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  37. Jessica Taylor

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  38. Tom Ashworth

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  39. David Morton

    RT @glaikit_f: http://liberalconspiracy.org/2011/03/31/incompetence-will-destroy-this-government-not-the-cuts/ – it's not astonishing to me.

  40. sunny hundal

    If you haven't read this by @suey2y yet, its gold: 'Incompetence will destroy this government, not the cuts' – http://bit.ly/ifMNd4

  41. James Tregaskis

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  42. James Tregaskis

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  43. Richard Hartley

    'Incompetence will destroy this government, not the cuts' – http://bit.ly/ifMNd4 (- interesting read

  44. dOSsdaz

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  45. Skip Sumlin

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  68. Neil White

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  75. Christopher Clough

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  76. Fraser Fulton

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  77. Fraser Fulton

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  78. Rachel Hubbard

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  79. UK Uncut divides opinion at the March for the Alternative, Ed Miliband is accused of making a serious strategic mistake and Moussa Koussa arrives in the UK: political blog round up for 26th March – 1st April 2011 | British Politics and Policy at LSE

    […] credentials. Sue Marsh at Liberal Conspiracy suggests that it will be incompetence that will destroy the coalition, not the […]





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