radiofree.asia

Labour accused of reshashed austerity ‘Osbornomics’

If you’ve been on Twitter in the past 24 hours, you’ve no doubt seen the following video in which one of Labour’s haircut MPs likens the fiscal deficit to Britain’s beloved biscuit:


You’ve probably also noticed:

  • Favourable journalists and thinktankers creaming themselves over how slick the video is.
  • People who don’t have long-term memory issues pointing out that Labour are making the same argument George Osborne did in 2010.

Taking the biscuit

In the video above, McKee lays it out clearly:

There’s a reason Britain feels broke and it’s probably not what you think.

I’m going to explain but first of all you need to understand one thing. It’s called debt-to-GDP ratio. Sounds boring — kind of is boring — but it’s important. Basically means how much debt the government has compared to how rich the country is.

When I was born in 1994, it was about 30%. In other words, for every pound the country made, the government owes 30p in debt. And it stayed that way until around about 2008, when the banks ran out of money and we had to bail them out.

‘When the banks ran out of money and we had to bail them out’ — is that what happened, is it?

We seem to remember the ways financial institutions were acting like casinos and dishing out dodgy sub-prime mortgages to customers who couldn’t afford them, triggering an entirely avoidable global meltdown. That’s if we hadn’t deregulated the banks in the 80s.

2008 was the perfect moment for politicians to take back power from rogue billionaires who have rigged the game in their favour. Instead, we bailed them out, and they’ve repeatedly bit the hand which fed them ever since.

This is why we’re on the verge of a crash which could make 2008 look like a picnic.

To be fair to McKee, he was 14 when 2008 happened, so possibly he still has a teenager’s grasp of the crisis.

He goes on to say:

So then, debt jumps to 60%. Over the next 10 years of Tory government, it rises to about 80%. Then some guy eats a bat in Wuhan, and now nobody can go to work.

We don’t know how much McKee is paying his banter writer, but it’s too much.

Osbornomics

Getting to the George Osborne of it all, McKee said:

So the government has to borrow even more money. And today, Britain’s debt-to-GDP ratio is roughly 100%. But the weirdest thing is that’s not even the main problem. Because in France, the debt-to-GDP ratio is 113%. In America, it’s 120%. Japan’s 240%. What’s really mad is that Britain is paying more interest on its debt than any of these countries because the people lending money to the government aren’t just looking at the total amount of debt, but how quickly it’s racking up.

Think of it like this. Japan is your mate who’s always in his overdraft. America’s the guy who spends a lot, but always shows up to work. Britain was the sensible one, but we’ve bought a dog, a new car, and a hair transplant all in one month. We’ve pretended that we’ve had a big pay increase, but in reality, we’ve just got a credit card with a lot of debt.

This is the austerity portion of the argument.

‘It’s not that we’ve allowed rich people to take everything that isn’t nailed down; it’s not that we’ve sold off all our utilities and infrastructure off to thieving international conglomerates — it’s that we dared to spend any money whatsoever on things which benefitted the wider public‘.

You’ll notice McKee using the credit card analogy which we all realised was bullshit in the early 2010s. The analogy was so widely contested that the BBC actually pulled themselves up for using it, as this report found:

Note on household analogies. That states don’t tend to retire or die, or pay off their debts entirely, is one way national debt is not like household or personal debt, not like a credit card for example, and why analogies with household debt, or suggestions the government must ‘pay off’ or ‘pay down’ the debt can cause intense debate. Clearly, pithy, accessible metaphors are valuable to journalists and audiences. And ‘paying off’ is a tempting phrase even to those who know the arguments because it seems to express the idea there must be some degree of discipline over debt, even for a state. We just used a household analogy by saying mortgage debt equal to 100% of income would not usually induce fear. But again, it helps to know that household analogies are dangerous territory, intensely contested, and can easily mislead.

The BBC was following the lead of Tory chancellor George Osborne, who said that “Labour maxed out the nation’s credit card“. Osborne was using the debt as an excuse to implement austerity — the politics of wealth extraction. It’s unclear if Labour wants to double down on austerity or think these talking points are a good excuse for maintaining the status quo. But the argument will continue to prop up politicians seeking to cut services to finance tax cuts for the rich.

Oh, and lest we forget, austerity was a disaster. Cutting spending didn’t lessen the debt; it just made us all poorer.

All except the mega rich, obviously.

Response

Getting to the response, many were sickened to see Labour aping the politics of the 2010 coalition government:

On the other hand, a cadre of the nation’s most banal centrists, journalists, and think tankers were custard creaming themselves:


So it’s a case of who you listen to; the people who warned you that austerity was a mistake, or the professional idiots paid to be wrong about everything.

Careful, buddy

By now, we’re noticing a weekly pattern: Labour pushes new messaging, establishment duds fall over themselves, and then the weekly polls show the government is down another percentage point. Reheated Osbornomics is not going to move the needle, just like Starmer’s conference speech didn’t.

Oh, and one last thing, we already had a way of explaining the economy with biscuits, and it’s this:

Rupert Murdoch pointing at a migrant and saying 'careful, mate that foreigner wants your cookie'

Featured image via Gordon McKee

 

By Willem Moore

This post was originally published on Canary.