Monday, 1 December 2014

Nick Clegg - nonsense economics and ideological attacks on the working-age poor


On the 1st of December 2014 the Liberal Democrat leader Nick Clegg came out with some absolutely astonishing comments about the Tories his party enabled into power in 2010.

His headline grabbing comments were the statement that the latest Tory economic plans are "complete and utter nonsense" and that George Osborne is attempting to balance the books "on the backs of the working-age poor".

It's beyond the realms of possibility that Nick Clegg was unaware that George Osborne's ideological austerity experiment was always "complete and utter nonsense". It only takes a rudimentary understanding of basic macroeconomic ideas (like fiscal multiplication and aggregate demand) to understand that arbitrary across the board government spending cuts at a time of low economic demand are a recipe for economic stagnation.

Nick Clegg was well aware that the Tory ideological austerity experiment was abject economic gibberish, and that their plan to load the costs of the bankers' crisis onto the poor and ordinary was socially unjust, but he signed up to support these agendas anyway back in 2010 in order to bag himself a six figure ministerial salary and a short-lived sense of self importance. How else could you explain Clegg's pr-election statement that "we think, that merrily slashing now is an act of economic masochism ... so if anyone had to rely on our support, we were involved in government, of course we would say no, do it sensibly"?

It is absolutely clear that the Lib-Dems opposed Osborne's ideological austerity experiment before the 2010 General Election, but that they changed their tune to become cheerleaders for it as soon as it suited the short-term self-interest of the Lib-Dem leadership.

This decision by Clegg and the Liberal Democrats to enable the Tories back into power to impose their ideological "serve the rich, smash the poor" agenda has led to a spectacular hemorrhaging of Liberal Democrat support from 20%+ in 2010 to the 6-8% support they have now. Things have got so bad that Clegg's party lost 10 of their 11 MEPs in the 2014 European elections and finished as the 5th party behind UKIP, Labour, the Tories and the Green party.

Nick Clegg and the Liberal Democrats have become a hopelessly toxic brand, and I wouldn't be at all surprised to see the party attempt to rebrand itself completely, or break up into two different parties (the right-wing economic liberals and the centre-left social liberals) once they are rid of Nick Clegg.

           
Some of Clegg's other comments about austerity are best described as revisionist drivel, especially his assertion that the coalition government "has not been dogmatic about deficit-reduction plans".

Clegg went on to assert that "
when it became obvious that the deficit was not going to be eliminated by the end of this parliament, far from doing what some people urged me to do – which was to cut even more – we said no ... it is going to take a little longer, and it will be three years into the next parliament before we wipe the slate clean"This is about as clear a demonstration as is possible that Clegg is talking complete rubbish. The reason Osborne's ideological austerity experiment failed so spectacularly to deliver the promised results (complete elimination of the budget deficit by now) is that arbitrarily cutting government spending at a time of low economic demand simply reduces economic demand even further.

If Clegg had listened to anyone sensible when it became obvious that Osborne's austerity experiment was failing badly, they would have suggested that arbitrary across the board cuts need to be stopped in favour of investment in areas that produce strong economic returns (infrastructure spending, social housing, flood defences, public services, research and development, tax inspectors etc) and cuts/reforms need to be imposed on wasteful areas of government spending (tax cuts for the rich, Ian Duncan Smith's failing welfare reforms, half a million quid in three years on ministerial limos for Eric Pickles, Trident etc). It's clear that Clegg was only ever interested in listening to right-wing hawks and their mantra of "harsh spending cuts haven't worked, therefore we need even more harsh spending cuts than ever".

The worst thing about the above is that it shows how dogmatic Nick Clegg and the Liberal Democrats have become since they joined forces with the Tories. Gone is the stirring rhetoric that ideological austerity would be "economic masochism" and instead we have a ludicrous narrative about how we should be thankful that the Lib-Dems allowed Osborne to continue his failing austerity experiment instead of allowing him to intensify it, as if ideological austerity and ideological austerity on steroids are the only two conceivable options.


What could be more dogmatic than presenting what we did or an even more extreme version of what we did as the only two conceivable options?
   
There are two factors that make Clegg's criticisms of Tory economics so incredibly weak. The first is that Clegg and the Liberal Democrats have spent the last four and a half years assisting the Tories with their nonsensical austerity experiment and their policy of loading the costs of the bankers' crisis
 "on the backs of the working-age poor", so to try to change tune and blame the Tories now is a stunning display of political opportunism that nobody but the most die-hard Lib-Dem supporter is going to be fooled by.

The second massive criticism is that he is still incapable of accepting what is self-evidently true - that ideological austerity has utterly failed to achieve what Osborne claimed it would. His criticisims of Tory economics would carry a lot more weight if he was man enough to admit that supporting Osborne's ideological austerity agenda was a huge mistake that has done immeasurable economic and social devastation to the United Kingdom and to his own party. 
  
         
In conclusion it's a bit bloody much for Nick Clegg to suddenly decide to publicly distance himself and his party from the failing ideological austerity experiment they have loyally voted in favour of time and time again, simply because he knows there's a General Election on the horizon and he needs to put as much space as possible between his party and the ridiculous economic shambles they have allowed to happen for the last four and a half years.


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