The 6 right-wing myths behind this Budget
June 22nd, 2010This is one of those watershed budgets where the governing party tries, not simply to make budgetary adjustments to the nation’s finances, but to change profoundly the ideological underpinnings of the State itself. But the whole project is built on a string of fundamental myths which give an almost surrealistic atmosphere to today’s proceedings. Here are the main myths.
1 The financial crash and economic downturn have been caused by Big Government, not by the markets,
2 The budget deficit is out of control, and if not brought rapidly under control it will lead to disaster like the Greek collapse,
3 Excessive public spending is the central cause of the problem, and needs to be drastically cut back,
4 If the public sector is cut back to a much smaller size, the suppressed private sector will emerge to fill the space as the engine of sustainable expansion,
5 Balanced budgets are the right way to run the economy, like balanced household budgets, and the only way to produce stable prices,
6 The precedent of other countries, like Canada, show that harsh cuts, however painful, are the quickest and most effective way to generate strong growth thereafter.
These ideas have been insidiously and relentlessly imprinted on the nation’s consciousness over the last weeks and months to lay the foundations for today’s measures. Yet every one of these prescriptions is utterly wrong. This is why. (more…)
