Change is not a pleasant process, but we must not shy away from it. There is an alternative. It’s time to engage. It’s time to make the world anew.

Published by Anonymous (not verified) on Mon, 11/05/2020 - 1:47am in

World in handsImage by Mariana Anatoneag from Pixabay

All labor that uplifts humanity has dignity and importance and should be undertaken with painstaking excellence.

Martin Luther King, Jr.

 

While the scale of the real human tragedy of austerity and lack of strategic planning continues to be revealed in our hospitals, care homes and community settings, this week the Bank of England warned that the UK was facing an historic recession. UK demand has plummeted, and consumer confidence has declined sharply as the unemployment rate has risen and people’s concerns are reduced to the daily task of just living in lockdown.

At the same time, in response to the government’s fiscal injection to mitigate the dire consequences of the economic slide that is unrolling before us, the debt sirens are predictably rising from the icy waters in an attempt to lure, yet again, an unsuspecting public into believing that there will be a future financial price to pay, when the human cost is the real issue. Given ten years of cutting vital public infrastructure, the consequences of which we are currently living through, the prospect of a deep recession which will last well beyond the end of the pandemic and the challenges we face from climate change are what we should worry about rather than the government deficit.

If we are to believe politicians and think tanks, there will be no option but to cut public spending to reduce public debt once the pandemic is over. Indeed, that message is being reseeded in the public consciousness by past and present Tory Chancellors of the Exchequer. With George Osborne calling for more austerity only a few weeks ago, Rishi Sunak waded in this week with the suggestion that he was preparing to ‘wean’ businesses and workers off the government’s furlough scheme by cutting wage subsidies as part of an attempt to get people back to work as and when the lockdown is eased in the future. The flaw in his plan is that is difficult to see at this precise moment in time where these ‘alternative’ jobs will come from – at least in the short to medium term.

He also claimed that the nation might become ‘addicted’ to state generosity. Apart from the offensive nature of this statement (which suggests that working people are living the high life and lazing their lives away behind the curtains on public money when in reality they are trying to make ends meet on 80% of their pay, or still waiting as self-employed to get any money at all), the idea that anyone would choose to remain out of work tells us two things; firstly that the government is not beyond using scare tactics to bully people back to work when they are already fearful for their financial security and secondly that the government’s fiscal injection, which was initially hailed as a positive step forward, comes with conditions that are still being framed in household budget terms. The narrative is being cynically being shaped for a new normal. The government, instead of serving the nation, is once again and predictably intending to serve only a small section of it while punishing the rest.

It would seem that under the radar the groundwork is being laid for an economic reset to complete the already skewed distribution of resources into ever fewer hands. More austerity, more cuts to our public and social infrastructure which is already on its knees and then the final ‘coup de grace’ or end game the privatisation of the remaining parts of the public infrastructure including the NHS. As we are already seeing, the government is using the pandemic to transfer even more key public health duties into the private sector. Government contracts are already being awarded centrally to the private sector under the emergency measures with no public scrutiny. Deloitte, KPMG, Serco, Sodexo and Boots are just some of the companies which have secured public funding to manage drive-in testing centres, purchasing of PPE and other vital equipment. This is disaster capitalism at work and the alarm bells should be ringing loudly. Allyson Pollock, who is director of the Newcastle University Centre for Excellence in Regulatory Science, co-author of the NHS Reinstatement Bill and NHS campaigner said ‘We are beginning to see the construction of parallel structures, having eviscerated the old ones. These structures are completely divorced from local residents, local health services and local communities.’

Democracy, both local and central, has over decades been undermined. Now, under cover of COVID-19, we are seeing the State using it to ally with big business to suit the continuing ideological interests of the former and the profit motives of the latter. Trade deals currently being negotiated with the US by the UK government are part of this growing globalised structure aiming to reinforce the power of corporations with state support and dictate the terms by which citizens live their lives.

In 2010 people accepted Tory austerity because they believed the narrative that Labour had overspent, and they had to get the public finances under control. They understood their own personal finances and thought, understandably, that the state’s must be the same. Even now, despite the growing number of people that know that the State’s finances cannot be likened to their own household budget, the government is trying to re-forge the worn-out austerity record anew.

Will the public be taken in yet again by this false narrative? The economist Danny Blanchflower said recently that he thought that people would not accept more austerity. If that were true, then at this moment of national crisis it should be a public wake up call. We don’t have to be economists to understand what the consequences are. Every afternoon at 5pm with the government’s daily briefing, the evidence is increasingly being revealed of the very real human costs as financial hardship bites and the death toll increases.

We need to learn that economics is then not the dry, boring subject that we have patronisingly been told should be left to the experts. Quite simply, it determines what happens to each and every one of us as a result of the ideologically driven political decisions made by our elected politicians. Although distrust, quite rightly, has grown about our political institutions, the truth remains that whilst we still have an important role to play in holding them to account for their policy decisions we can only do so from a position of knowledge and the willingness to challenge the status quo.

Over decades, we have been primed by politicians, institutions and the media to accept the economic narrative. We have stood by as our health and welfare systems have been cut to the bone. We have accepted that cuts were necessary rather than questioning the economic orthodoxy which spawned them. We have accepted the flawed, politically pushed narratives that deficit reduction or balanced public accounts were more important objectives than serving the interests of citizens. Those who have borne the consequences in terms of hidden poverty and inequality, attributed by pernicious ideology to their own failings, are now slowly waking up to the economic realities of their lives. Insecure employment and low wages, hunger and food banks and homelessness have all arisen from the pursuit of a damaging ideology whereby government has relinquished its responsibility to serve the best interests of its citizens and placed the blame on those citizens themselves. All the while also sowing division to serve its smoke-and-mirrors agenda – the expropriation of public wealth into a few private hands.

We have been persuaded by a false narrative that government deficits are a burden rather than an essential and normal mechanism to serve the national interest. While the government focuses on getting the ‘economy’ back to normal, as if it were an unidentified object out there in space, it has ignored that, fundamentally, the economy is its people. After decades of living in a financialised world of rentiers, hedge funders and money men we have lost sight of the real wealth – which consists of people and the natural and other resources which sustain life on our planet.

The economy is nothing without the people, or indeed those resources. Health and social care workers, teachers, local council employees delivering vital services, police officers keeping the peace, farmers producing the food we eat, factories processing it or lorry drivers delivering it to supermarkets and stores, those who collect our rubbish, clean the streets and provide all sorts of other services to the public, the list is long of essential workers whose value during this extraordinary event we are only just beginning to appreciate having taken them for granted for too long. It is not the billionaires that create the wealth of the country, it is the people. We make our contributions to societal and economic wellbeing, not through the tax we pay (which whilst essential is not required to fund government spending as we are led to believe) but through the vital work we do to keep society functioning.

It defies belief that whilst politicians and others are already preparing the public for more austerity, the Bank of England is warning that the COVID-19 crisis will most likely push the UK economy into the deepest recession for 300 years. At a time when the worst effects of a global economic crisis are yet to unfold (despite the Bank of England’s laughable and misplaced confidence that there will be ‘only limited scarring of the economy’ and it will ‘bounce back […]much more rapidly than the pull back from the global financial crisis’) a government of any political shade should be proposing targeted fiscal spending aiming at four objectives:

  • To ensure in the immediate future sufficient spending to keep people safe, fed and sheltered until the immediate threats of COVID-19 are under control and that strategic services such as health and social care, energy and food production and transport and communications can operate as effectively as possible with the least risk to their future stability. This might involve more state intervention, price controls and rationing if necessary.
  • To take back public services into the public domain and reinvest in our public and social infrastructure to secure the vital foundations for a healthy economy for today’s and future generations. It won’t be enough for Boris and his ministers – or indeed the public – to clap for our public sector workers. We need a commitment to changing the ideological narratives which have done so much damage and to reward those who make the real contributions to economic stability and social well-being.
  • To offer a permanent Job Guarantee programme to provide the necessary counter-cyclical mechanism to support people whose livelihoods are likely to be disrupted for some time in the future as unemployment continues to rise as a direct result of both the domestic and global economic slowdown. Unemployment is a political choice, not an economic necessity.
  • To develop a workable and just pathway towards a greener and more sustainable economy without which the future of the planet is in jeopardy.

Whilst this is what should happen, whether it does is yet another question. It is regrettable that government, whilst having seemingly recognised its sovereign currency-issuing powers to avert economic disaster, now seems to be rowing backwards at a time when government intervention is vital if we are to secure a future at all. The entire economic system has been built on sand. The 2008 Financial Crash was practice for what might come and yet our elected politicians failed to grasp the nettle in any meaningful way, tweaking here and there but leaving the status quo in place.

Without putting too fine a point on it, globally we are at a planetary crossroads and COVID-19 is just one issue of many which will necessarily have to drive a reset in how we do things. We certainly need an economic recovery, but the question is what values will it be based on, what will it consist of and finally and very importantly who will benefit? The big questions of our time remain unanswered for the moment and given this government’s ideological agenda it is difficult to see exactly where we may be going. Although one might make some educated guesses. However, with increasing public recognition of the mess we are in and how we got here, combined with a better understanding of how government spends and what the real limitations to spending are, we could take a first step towards that better world we aspire to create for our children. Change is not a pleasant process, but we must not shy away from it. So much depends on what we do next. There is an alternative – so let’s make sure we are part of it. Ignoring it won’t make it go away.

 

 

A Job Guarantee is fundamental to any healthy economy. To find out more follow the link for an in-depth look at what it is and how it works.

https://gimms.org.uk/job-guarantee/

 

 

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The post Change is not a pleasant process, but we must not shy away from it. There is an alternative. It’s time to engage. It’s time to make the world anew. appeared first on The Gower Initiative for Modern Money Studies.