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I predict a riot

george osborneToday has been historic. Of all the days in British political history, today will take some beating. Because on this day, the government has pledged to solve a huge financial deficit with a massive deficit of its own.

An intellectual deficit so severe it makes George Bush look like Stephen Hawking.

This time last year I described the Conservative Party’s planned cuts as idiotic. Twelve months later, that description seems generous in the extreme.

The poor, the vulnerable, the elderly, the young, the disabled, the sick, parents, carers, public servants, charities, councils, the emergency services, small businesses, medium businesses, even some large ones. All will suffer from the loss of 490,000 jobs.

And it will result, I predict, in a huge fucking riot.

Brain FAIL 1:

The government tell us the reason for their huge budget deficit is the previous government’s excessive public spending. While it is true that spending increased 14.9 percent between 2007 and 2010 under Labour, it does not explain the 413.9 percent increase in the budget deficit during the same period, from £30.1billion to £154.7billion.

Because the main contributor to that has been the sudden and severe decrease in public revenues since 2007. The swing in government income from the three years prior to and the three years after the start of the financial crisis was a fall of eight percent. The swing in spending was only three percent.

This can be seen from a document on the Treasury’s website. So why do they continue to say that over-spending was the chief cause of this deficit?

Brain FAIL 2:

Faced with a problem largely caused by declining tax revenues, what does the government propose? Half-a-million job cuts. That, quite simply, is wrong. Very, very wrong.

Every economics textbook available will explain to our dear chancellor, should he ever learn to read, that increasing unemployment is a sure-fire way of decreasing tax revenues.

Brain FAIL 3:

Meanwhile, the savings to our expenditure column made by sacking public sector workers will be minimal.

David Cameron likes to compare running the government to running a business. When you need to save your business money, he says, you can make redundancies and instantly save the company that person’s salary. Great! The only problem with that comparison is that it’s fucking stupid.

Has Osborne really done his sums on this one? Well allow me.

If the government sacked someone on the UK average salary of £26,000, they would lose that worker’s tax revenues (about £6,000). But the state must also then pay out unemployment benefit (about £3,000), housing benefit (up to £9,000 per year for the average bedsit) and help them pay council tax (about £800 for that bedsit, depending on where you live).

So when you write off a £26,000 salary from the Treasury’s books, you have to remember to add about £12,000 to your outgoings and take off £6,000 from you incomings. Those 490,000 job losses don’t sound so economical now, do they? But that’s not all.

Brain FAIL 4:

The government has demonstrated today that it is incapable of joined-up thinking. Or even just thinking. We don’t need numbers to make this point, just logic.

If you make people unemployed, you make those people poorer. If you make more people poor, inequality will increase. When inequality increases, so too does nearly every social ill. This is common sense, but it has also been backed up by hard evidence.

An unequal society suffers more violent crime, more drug abuse, more alcohol-related problems, higher suicide rates, higher prison populations, higher rates of teenage pregnancy, worse obesity rates, more chronic conditions such as heart disease and cancer, lower life expectancy, more anti-social behaviour, a decline in trust and worse social mobility, to name a few. Oh, and more rioting.

But the real kicker is that there will be less money available to deal with all of these social problems.

Brain FAIL 5:

Even if the government was right to slash spending by £81billion (and it so isn’t), the choice of cuts they have made is insane and geared only towards further boosting the free market capitalists who financed the Tory election campaign.

Gone are the carbon-saving bodies, the corporate regulatory agencies, the universal welfare, the tuition fee caps, the school building programmes, the free school meals, any kind of future for young people, the art and the culture, that first year of retirement.

Still here are the wars, the weapons, the environmental destruction, the subsidies to the fossil fuel industry and the huge bonuses to bank bosses bailed out by the state just two years ago.

So whether or not the coalition government is indeed thoroughly stupid, ignorant and totally, utterly blind; or whether they are deliberately lying because they think those qualities are abundant among us, and because they know that a financial crisis is the perfect excuse to fulfill all of their debased neo-con small-state fantasies; there is still nothing to justify these cuts.

They won’t solve anything – not even the deficit itself.

And while nearly every one of our daily lives will get worse, at least £40billion of uncollected tax (and probably a lot, lot more) is resting peacefully, undisturbed, inside the bank accounts of those rich and corrupt British citizens who are actually to blame for this mess.

Where’s the taxman when you need him?



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