Monday 6 March 2017

Philip Hammond has been talking absolute crap about the economy

For the first seven months of his job as Chancellor of the Exchequer Philip Hammond remained pretty tight-lipped about his plans for the economy, but on Sunday March 5th he started blabbering ludicrous economically illiterate nonsense on ITV's Peston on Sunday show.

Hammond's interview with Peston will have come as a blow to anyone hoping that he might have the good sense to begin unwinding George Osborne's socially and economically ruinous austerity agenda, and the honesty to avoid talking about economics in deliberately misleading pseudo-economic platitudes.

However, instead of admitting that ideological austerity has utterly failed to achieve what the Tories claimed it was going to back in 2010, Hammond decided to blurt out the ridiculous austerity-justification that the Tories are trying to get Britain to "get back to living within our means".

The problem with this pro-austerity propaganda narrative that the Tories are interested in "living within our means" is that it is totally contradicted by their inept economic record.

The Tories came to power in 2010 promising that their austerity agenda would completely eliminate the budget deficit within five years. They spectacularly failed to achieve this primary objective, but instead of holding them to account for this extraordinary failure, the mainstream press let them completely off the hook before the 2015 General Election by allowing them to reframe their abject failure to eliminate the deficit as some kind of brilliant success by endlessly repeating guff like "we've cut the deficit by a third"!

Instead of pointing out that boasting about having cut the deficit by a third actually means that they failed to achieve their headline objective by two thirds, the press just let them get away with reframing their inept failure as a praiseworthy success!

The Tories now admit that there's no hope whatever of them eliminating the deficit until well after 2021, which means they're going to end up taking a lot longer than eleven years to achieve what they said they would do in five. The consequence of all of this extra borrowing is that the Tories have ended up creating more new public debt than every single Labour government in history!

Would you trust a party with such an inept economic track record to do what they say they're going to do? Well it's clear that the right-wing propaganda rags want you to. The S*n described his "living within our means" platitude as "spot on".

Aside from spurting misleading gibberish about "living within our means" Hammond also had some other ridiculous things to say about the economy too.

Instead of acknowledging that the NHS and social care are in crisis and committing to resolve the problems, he described the concept of adequately funding the health services as a "spending spree"! This kind of rhetoric perfectly illustrates the rotten Tory mentality. Adequately funding the health services so that people don't end up dying on trolleys in hospital corridors is unjustifiably reckless spending, while handing out £billions more in corporate welfare and tax cuts for the super-rich minority are perfectly justifiable priorities!

Another of Hammond's ludicrous comments involved comparing government spending with shagging a credit card up to its limit. Anyone with the economic literacy of a ten year old could tell you why such a comparison is so desperately misleading, but, as usual, the mainstream press not only failed to criticise Hammond's deliberate effort to muddy the economic waters, they uncritically repeated his absurd credit card analogy as if it actually made sense.

When the cost of public sector borrowing is at an all time record low (due to the all time record low interest rates) there's no way of seeing an effort to compare public borrowing with recklessly spending on a high interest credit card, than as a deliberate effort to confuse and mislead people.

If any form of public spending can be compared to credit card recklessness then it's the kind of rip-off PFI schemes that end up costing the taxpayer many multiples of the value of the infrastructure during the decades long repayment period. Ordinary public sector borrowing in order to invest directly in infrastructure and services is much more like taking out a very low interest loan in order to make material improvements to your business.

The mainstream media clearly don't care though. Even supposedly reputable sources like the Financial Times uncritically repeated Hammond's ridiculous credit card analogy as if it wasn't desperately misleading political propaganda designed to fool the economically uneducated.

You could be forgiven for imagining that right-wing tabloid hacks at the S*n, Express or Daily Mail are too stupid to see Hammond's absurdly misleading pseudo-economic wittering for the rubbish that it is, but if even broadsheet and Financial Times correspondents are uncritically repeating it, then the conclusion is obvious. Reputable economics correspondents are clearly not stupid enough to believe such nonsense, so they're simply working on the assumption that the majority of their readership are gullible economically illiterate idiots who are incapable of clocking Hammond's woeful pseudo-economic gibberish for what it is, and they're happy to keep things that way.

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