Sunday, 3 April 2016

George Osborne just broke another unwanted record


In the fourth quarter of 2015 the UK recorded it's worst ever current account deficit figures since quarterly recording began in 1955. The gap between wealth flowing in and out of the UK swelled to a £32.7 billion deficit for the quarter, which is equivalent to 7% of GDP.

For the entire year of 2015 the current account deficit was £96.2 billion, which is 5.2% of UK GDP, the worst since annual reporting began in 1948.  


The budget deficit
  
The Tories have spent the last six years trying to convince the public that the size of a government's budget deficit is the single over-riding priority when it comes to economic sustainability. It's undeniable that the Tories have attempted to fixate as much public attention as possible on the size of the budget deficit in order to provide some kind of pseudo-economic justification for their ideological austerity agenda, whilst criminally neglecting the importance of other vital economic indicators like the current account deficit, balance of trade, GDP per capita and productivity.

It doesn't even matter to them that they spectacularly failed to keep their promise to eliminate the budget deficit by 2015, they simply set about repeating the mantra "we've cut the deficit by a third" to re-brand their epic failure as a boastworthy success, then moved the goalposts to elimination of the budget deficit by 2020!

Even though they utterly failed to achieve what they said they were going to achieve, the Tories still want you to think about the budget deficit as if it is the single most important economic indicator, one that massively over-rides every other measure of economic health.

The current account deficit

    
Image credit: Guardian
Stuff like the balance of trade and the current account deficit used to be quite high profile measures of economic success, but since the 1980s they have fallen out of favour, not because they don't tell us anything important about the state of the UK economy, but because both sets of figures have been unrelentingly bad for decades that no governing party in their right minds would ever want to draw public attention to them.

While other countries like Germany, Japan and China have all successfully managed to export more than they import for sustained periods over the last four decades, the UK has almost constantly imported more than it has exported.

Even though their New Labour predecessors oversaw the continued weakening of the UK balance of trade and current account balance, the successive Tory led governments since 2010 have set one record after another for the worst balance of trade on record and have just set the worst current account deficit in history. Even analysis in the rabidly pro-Tory Daily Telegraph admits that the UK current account deficit has widened significantly every single year since 2011.

What the future holds

There are lots of factors to consider when it comes to considering the future, but two issues stand out.

The first has been picked up by much of the mainstream media, which is the fear that "Brexit" would cause a rapid divestment from the UK causing an even worse current account deficit than the current monstrosity. It's hard to take financial market futurology too seriously given that the vast majority of economists completely failed to see the vast 2007-08 global financial sector insolvency crisis coming, but one thing is for sure - financial markets don't tend to react well to uncertainty. It's impossible to say what the long-term effects of "Brexit" would be, but the massive uncertainty over what a post-EU British economy would actually look like would be highly likely to cause some serious short-term financial instability and divestment verging on outright capital flight at the very least.

A second concern that is particularly topical is that David Cameron and the Tories seem determined to sacrifice the UK steel industry as a tribute their "special relationship" with the Chinese*. The further destruction of the UK steel industry would make the UK will be even more heavily reliant upon steel imports, worsening the UK balance of trade even more, and negatively impacting future UK current account deficits.
 

Conclusion

One of the core Tory propaganda narratives in favour of their ideological austerity agenda has been repetition of "living within our means". Even if George Osborne hadn't completely failed to eliminate the budget deficit by 2015 like he promised to (racking up more new debt than every Labour government in history in the process), it's pretty damned hard to reconcile the development of the biggest ever deficit in wealth flowing out of the UK economy with the endlessly repeated Tory "living within our means" mantra isn't it?

Still, the popularity of the right-wing folk mythology that the Tories are economically competent doesn't look like it will be going away any time soon, despite the overwhelming evidence that it's glaringly counter-factual gibberish. So we'll all have to put up with hearing about what a great job the Tories have been doing, even though there is an ever deepening chasm full of evidence of their record breaking failures.


 Another Angry Voice  is a "Pay As You Feel" website. You can have access to all of my work for free, or you can choose to make a small donation to help me keep writing. The choice is entirely yours.



* = The Tories are so determined to kill the British steel industry that they actively voted down an EU proposal to allow higher import tariffs on dumped Chinese steel (like the United States have done to protect their own steel industry) and were "thanked" for their loyalty to Chinese economic interests when China slapped a 46% import tariff on Welsh steel products!




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The pre-election "contract with the electorate" that the Tories want you to forget
                     
The Tory plan to force privatise every school in England
       

What does George Osborne have to do to deserve the sack?
                             
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Austerity is a con
                                
Margaret Thatcher's toxic neoliberal legacies
  



Saturday, 2 April 2016

The UKIP response to the steel crisis


The UKIP response to the steel industry crisis is staggeringly hypocritical and opportunistic, even by their own woeful standards.

Hypocrisy and lies

Nigel Farage, UKIP and the Brexit crowd have gleefully jumped on the opportunity to use the ongoing steel industry crisis as a stick to beat the EU with, despite the fact that they repeatedly voted against EU measures to protect the European steel industry from dumped Chinese steel.


The UKIP excuse for voting against measures to help the steel industry is the same tired old nonsense about how they supposedly always vote against EU rules as a matter of principle, even if they would be good for the UK.

The obvious argument against this kind of petty absolutism is that voting against EU measures that would benefit the UK is a perfect example of "cutting off your nose to spite your face". Voting against British interests is bad enough, but then using troubles in the industry that they explicitly voted against helping in order to crow about how membership of the EU would "spell the end of the steel industry in this country" is shockingly hypocritical.

Another much more compelling criticism of UKIP voting against measures to protect the European steel industry on the grounds that they "always voting against EU rules" is that this justification is an outright lie. In 2014 the UKIP spokesman for energy and industry Roger Helmer voted in favour of the TTIP corporate power grab in the European Parliament.

It turns out that if the purpose of the vote is to protect the European steel industry from dumped Chinese steel UKIP will vote against it on "principle", but if the purpose of the vote is to allow multinational corporations to completely over-write the sovereignty of all of the states in the Europen Union (including the UK), apparently it's perfectly fine for UKIP to vote in favour of it!

Misrepresentations

Various UKIP and Brexit social media pages have seized on the steel industry crisis to begin sharing misleading infographics about how the EU is supposedly preventing the UK from renationalising the UK steel industry. There's an awful lot wrong with this kind of anti-EU propaganda,enough to fill an entire article in fact, but for the sake of brevity I'll stick to a few key bullet points.

  • UKIP is an extremely right-wing party led by a guy who describes himself as "keeping the flame of Thatcherism alive". The idea that free market fanatics in the UKIP leadership would nationalise the steel industry if they had the option is absolutely laughable.
  • If UKIP do succeed and achieve Brexit, that will simply consolidate Tory power and they've already clearly stated that they'd rather see the UK steel industry die than consider nationalisation. It's clearly the Tories standing in the way of nationalisation, not the EU.
Consequences of Brexit

If we subject Nigel Farage's claim that continued EU membership
 would "spell the end of the steel industry in this country" to a little bit of scrutiny it becomes completely obvious that it's unrealistic scaremongering rubbish.
If Britain quits the EU, we won't suddenly get a government that gives a damn about the UK steel industry, we'll be stuck with the Tories, who see the UK steel industry as a sacrificial pawn in their efforts to suck up to the Chinese.

Remember when the Redcar plant was shut down costing 3,000 jobs in the industry and causing terrible knock-on effects for the rest of the community too*. What were the Tories up to then? They were busy sucking up to the Chinese and concocting "one of the worst deals ever" to bribe them into building our energy infrastructure for us weren't they?

It's also important to note that the Tory government were actually the ringleaders of the resistance to EU measures to impose import tariffs on artificially cheap Chinese steel.

Just weeks ago the Tory business minister Sajid Javid told parliament that it would be wrong to protect the British steel industry by imposing punitive import tariffs on dumped Chinese steel, and now it turns out that the Chinese have put a 46% import tariff on Welsh steel!

The Tory response to the massive over-production of steel by the 80% state owned Chinese steel industry ruining the UK steel industry, and the Chinese imposition of punitive import tariffs on Welsh steel is to say that nationalisation of the UK steel industry is off the table as an option, and the imposition of punitive import tariffs on Chinese steel would be morally wrong!

What UKIP are arguing for is to hand stewardship of the UK steel industry to the completely unrestrained Tories, who clearly value their budding "special relationship" with China so much more highly than the UK steel industry that they're prepared to sacrifice in order to beg favours from the Chinese.

Conclusion

It's understandable that UKIP want to argue in favour of leaving the EU, it's the entire raison d'etre of their party after all.

The problem isn't that they want the UK to leave the EU, it's the way that they opportunistically use a crisis in the steel industry to fearmonger about the EU, when they voted against EU measures to help the steel industry, and when they know as well as everyone else that the steel industry truly will be doomed under unrestrained Tory stewardship because they're clearly far more concerned with sucking up to the Chinese than they are with protecting a strategically vital British industry and the tens of thousands of jobs it supports.

   
 Another Angry Voice  is a "Pay As You Feel" website. You can have access to all of my work for free, or you can choose to make a small donation to help me keep writing. The choice is entirely yours.



* It's worth remembering the idle Tory promises to "do everything we can" to help the Redcar plant that soon closed with the loss of 3,000 jobs and contrast that with David Cameron's promise to do ... err ... "everything he can" to support the steelworks at Port Talbot.



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The Tory nuclear price-fixing deal
                
The Tory "economic recovery" mantra is a lie
                         
The pathetic Tory response to the steel industry crisis
                        
12 Tory-UKIP defectors
           
The Tory ideological mission
                     
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Friday, 1 April 2016

The "northern powerhouse" myth

  


To pretty much everyone bar Tory party tribalists George Osborne's "Northern Powerhouse" is already a standing joke. I'm still going to write an article criticising it though, because even though an awful lot of people see Tory references to the "Northern Powerhouse" as the smug and contemptuous Orwellian propaganda that it is, it's still worth compiling some of the evidence so that people know exactly how bad it is.

Local government cuts


The Tories are always banging on about investment in the north, but what they don't say is that since 2010 they've slashed £3.9 billion from local council budgets in the north. Investing a few million here and a few million there whilst slashing almost £4 billion across the region is a classic example of the Tory strategy of giving with one hand, and robbing an awful lot more with the other.

It's absolutely clear that the majority of Tory local government cuts have hit the industrial north, south Wales, deprived parts of London and parts of the midlands, while wealthy Tory councils in London, the Home Counties and the rural north have got off much more lightly, or even ended up with funding increases!

When Tories (including David Cameron's own Oxfordshire council and his own mother) started complaining about the brutal effects of the local council cuts they were suffering, they announced a two year £300 million fund, 83% of which was directed at wealthy Tory councils, with only a tiny fraction for urban councils in the north that have borne much more severe cuts than the wealthy Tory voting councils.

Some "Northern Powerhouse" eh?

Re-branding existing infrastructure projects as Tory schemes

One of the biggest complaints about the "Northern Powerhouse" is how the Tories have dressed up pre-existing infrastructure projects as "Northern Powerhouse" initiatives. All but two of the so-called "Northern Powerhouse" infrastructure schemes were announced before it even existed, and three of them were actually announced by the New Labour government before the Tories came to power in 2010!

There are only two directly funded infrastructure projects that have been announced since "Northern Powerhouse" came into existence. One is the project to turn the M60 into a "smart motorway" and the other is a road upgrade to the A556, which goes through George Osborne's own constituency!

The "Northern Powerhouse" turns out to be a bit like how the Mayor of London Boris Johnson claimed credit for the London cycle hire scheme that became known as "Boris Bikes", even though the project was originally conceived under the leadership of his Labour predecessor Ken Livingstone.

   
Struggling towns

Research by the Joseph Rowntree foundation showed that 10 of 12 of the most struggling towns are in the "Northern Powerhouse", while not a single town in the south features in the top 24 towns in most serious economic decline.   

The research found that the places in most serious decline were:
  1. Rochdale (north)
  2. Burnley (north)
  3. Bolton (north)
  4. Blackburn (north)
  5. Hull (north)
  6. Grimsby (north)
  7. Dundee (Scotland)
  8. Middlesbrough (north) 
  9. Bradford (north)
  10. Blackpool (north)
  11. Stoke (midlands)
  12. Wigan (north)
It's not just that these places are economically deprived, it's that they are in sustained economic decline, which is completely at odds with all the Tory propaganda about rebalancing the UK economy.

When confronted with these appalling findings the Tory "Northern Powerhouse" minister James Wharton refused to comment.

Vast spending disparities

George Osborne's "Northern Powerhouse" propaganda often features claims that the purpose is to rebalance the UK economy in favour of the north, but a look at the figures proves beyond doubt that the UK economy is still being heavily rebalanced in favour of London.

For every £1 per person that gets spent on infrastructure investment in the north east, London gets £24 per person in investment.

The idea that the economy can be rebalanced in favour of the north when London gets 24x the per capita infrastructure investment as the north east would be laughable if it weren't such a serious economic imbalance.

The "brain drain"

Everyone who grew up in the north is well aware of the "brain drain" towards London and the wealthy south. Everyone from the north knows plenty of people who abandoned their own region to find better jobs down south.

In order to create better jobs in the north and allow people to find good employment in their own region, the government needs to stop brutally slashing local government funding in the north and do some serious infrastructure investment, rather than just funding a few road improvements and repeatedly re-announcing existing infrastructure projects as if they represent new investment.

London is massively overcrowded, but big employers are unlikely to choose the north of England over London because northern infrastructure has been so badly neglected for so long, and London continues to get the lion's share of new investment.


The "Northern Powerhouse" is based in London!


Perhaps the most ludicrous aspect of George Osborne's "Northern Powerhouse" is that 97% of the staff it employs are based in London!

George Osborne talks about devolving power to the north, but the fact that almost his entire "Northern Powerhouse" team are based in London proves that his idea of devolution is London technocrats distributing political favours on an ad hoc basis to northern yokels who are far too backwards to run their own affairs for themselves.

  
 Another Angry Voice  is a "Pay As You Feel" website. You can have access to all of my work for free, or you can choose to make a small donation to help me keep writing. The choice is entirely yours.





More articles from
 ANOTHER ANGRY VOICE 
               
George Osborne's 2016 budget of failure
      
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Austerity is a con

Why I've decided to join the Tory party


 
Did you check the date today?

Of course the title of this article is an April Fool's prank. I would never join the Tory party because their ideology is rotten to the core. In this article I'm going to give a list just some of reasons why I will never support the Tory party.


Reasons I will never join the Tory party

Inequality

The core objective of the Tory party is the upwards redistribution of wealth. They slash the subsistence social security of the poor and vulnerable and repress the wages of the majority of workers. Meanwhile they shower lavish subsidies and tax breaks on corporations, the asset rich and high earners. That is what they do. They have always been the party that serves the interests of the wealthy minority. That is what they have always done.

The reason that the Tories serve the interests of the wealthy minority (multinational corporations, the landed gentry, the asset rich and very high earners) is completely obvious. The Tory party receives the vast majority of their donations from corporations, the landed gentry, the asset rich and high earners.

Economic illiteracy

One of the most persistent pieces of folk mythology is that the Tories are economically competent. The indisputable fact that George Osborne has created more new public debt than every Labour government in history combined should give people some indication that the story of Tory economic competence is either badly out of date, or a complete fabrication from the beginning.


It doesn't take a genius in macroeconomics to understand that the Tory "let's cut our way to growth" austerity ideology is an economically destructive one, especially when combined with a policy of showering corporations and the extremely wealthy with lavish tax cuts.

Slashing investment in infrastructure, services, research and development and support for infant industries during a prolonged credit squeeze is obviously economic lunacy because it reduces economic capacity and stymies economic demand.

Continuing with the upwards redistribution of wealth is not good for the economy either because it's a well established fact that poor and ordinary people create demand by spending a large proportion of their income, while the super-rich are likely to save any extra income (or just stash it in tax havens for that matter).

Ideology above evidence


The Tory ideological austerity agenda is far from the only example of them putting ideology above evidence.

The Tory plan to force privatise every school in England is not backed up by evidence, in fact, a look at some of the financial scandals that have gone on at numerous academy chains constitutes evidence that forced privatisation of every school in England would simply increase the scope for ruthless profiteers to siphon cash out of taxpayer funded education budgets to line their own pockets.

Another example of Tories putting ideology above evidence is their obsession with "Workfare" forced unpaid labour schemes for the unemployed. The Tories were well aware of the evidence from Canada and the US that such schemes don't help people find paid work, and in many cases actually act as an impediment to people finding proper jobs, but they've ploughed ahead with numerous forced labour schemes to extract free labour from hundreds of thousands of individuals regardless. Still this utter contempt for the evidence is hardly surprising from the DWP during Iain Duncan Smith's tenure, after all, he explicitly stated that he felt perfectly justified in misrepresenting statistics as long as he believed that his crude misrepresentations were the truth.

Yet another example of the Tories putting ideology above evidence is their absurd Psychoactive Substances Act. In 2015 they were warned by the experts that it's so incoherently drafted that it would be unenforceable in reality, but in 2016 they went ahead and put it on the statute books regardless. In the month before the act was due to come into force it turned out that the Tories have indefinitely delayed it after legal experts have told them that it's unenforceable!

Orwellian propaganda

The Tories have such contempt for the general public (the "lower orders") that they believe that they can hoodwink us into voting for them by presenting a series of Orwellian propaganda narratives like "we're all in this together"  - as they cut social security for the poor and cut taxes for the super-rich minority.

Another example is their constant talking up of their "economic recovery" when the actual evidence shows that under Tory rule the UK has suffered the slowest post-crisis recovery on record; working people have suffered the longest sustained decline in real wages since records began; the UK is going through an appalling productivity crisis; the trade deficit and current account deficit keep hitting all time highs; and GDP per capita is still below the pre-crisis level. In order to achieve all of this failure, George Osborne has created more new public debt than every Labour government in history combined!

Perhaps the most brazen of all of the Orwellian Tory propaganda efforts was their utterly bizarre attempt to re-brand themselves as "the workers' party". Surely even political novices know that the Tories hate ordinary workers and trade unions with an undying ideological passion and take every opportunity they can to oppress trade unions and strip workers of their labour rights?

Outright lies

In my view much of the responsibility for the fact that high profile Tories feel that they can lie with impunity falls on Tony Blair's shoulders. Once he got away with deliberately distorting the intelligence in order to promote the catastrophic invasion and occupation of Iraq (that eventually resulted in the rise of ISIS), it was a green light to the Tories that they could lie to the public with impunity.

Here are just a few examples of brazen Tory lies:

  • The so-called "contract with the electorate" that David Cameron made such a big fanfare of signing before the 2010 General Election is so full of lies and broken promises that they decided to delete every trace of it off their website in the hope that everyone would simply forget about it.
  • In 2013 David Cameron lied about "paying down the debt" in a party political broadcast and was rebuked for it by the UK Statistics Authority. During the Tory party conference in the autumn of 2014 he repeated the exact same lie, knowing that the UK Statistics authority have no power to sanction him for deliberately lying to the public, other than the sending of stern letters.
Lowering the standards of public debate

It's fair to say that every government has a share of language and logic manglers who have such a poor grip on logic and the English language that nobody in their right mind would allow them to teach in an infant school, let alone run a government department (the former New Labour Home Secretary Jacqui Smith springs immediately to mind), however this Tory government really is something else.

If you've ever had the misfortune of hearing the snide, wrong-headed, evasive, fallacious, misleading and downright dishonest crap spouted 
in interviews by the likes of Iain Duncan Smith, Priti Patel, Nick Gibb, Grant Shapps or Claire Perry you'll know exactly what I mean.

Alarmingly David Cameron is probably the worst of the whole lot. He simply won't ever give a straight answer to a question; he lies with impunity; he has no capacity for unscripted debate because his only talent seems to be mindlessly regurgitating the glib snidey remarks his script writers have prepared for him; and he runs away from unscripted debate like a coward. The man comes across as such an inveterate liar that you suspect that he'd lie in any situation, even if it was much easier for him to actually tell the truth.

It's absolutely shocking that such a high percentage of British people see such a dishonest and snidey spiv as being "statesmanlike", simply because he wears expensive suits, talks in a posh accent and carries a permanent air of smug self-entitlement.

I don't like Tories past or present, but I do think that articulate and intelligent Tories from previous eras like Benjamin Disraeli and Winston Churchill must be spinning in their graves at the fact their party is now being led by such a snide and intellectually stunted individual who continues dragging the standards of public debate down to ever more dispiriting lows.

Privatisation

In 2012 the Tories carved the NHS open for mass privatisation, ever since then massive chunks of NHS services have been handed out to private interests, many of them donors to the Tory party.

Since 2010 the Tories have been privatising thousands of publicly owned schools, for free, into the ownership of unaccountable private sector pseudo-charities, many of them owned and operated by Tory party donors.

In 2013 the Tories sold off a massive chunk of the Royal Mail at a bargain basement price. One of the biggest beneficiaries when the share price rocketed upwards from the artificially low starting point was a hedge fund that employed a guy who was best man at George Osborne's wedding!

After the previous private rail franchise bailed out of their contract to run the East Coast Mainline it was run as a not-for-profit public service for a while. Under public ownership it soon became the best performing and most popular franchise in the entire UK rail network. The Tories couldn't abide this crystal clear demonstration of the public sector massively outperforming the private sector so they re-privatised it even though the vast majority of people actually want the rail network renationalised.

The Tories have already sold off chunks of the part-nationalised banks at significant losses and now they're now planning to sell off the taxpayers' stake in RBS at an eye-watering £22 billion loss to the taxpayer.

Not content with steadily privatising over 5,000 publicly owned schools over the last six years the Tories have now announced plans to force privatise every single school in England by 2022.

During the last parliament the Tories were defeated when they attempted to privatise the Land Registry in order to create a cushy little monopoly for their private sector mates to rake in the cash. That appalling proposal has been snuck back onto the table. 


Right-wing authoritarianism


One of the most concerning things about the Tory party is their love of right-wing authoritarianism. They want to introduce new spying powers that would have made the Gestapo turn green with envy, launch economically insane deportation policies for working people, carry out a massive crackdown on the feeble vestiges of trade union power, abolish of the right to free speech, ban of intellectual opposition to the government, and continue to operate numerous forced labour schemes.

To top it all off, in 2015 David Cameron uttered a truly chilling sentiment (see image) that the government needs to actively interfere in the lives of law abiding citizens. This is the kind of deeply sinister thing you'd expect a villain in a Marvel Comic to say, not a British Prime Minister.


Incompetence

The Tory party is completely riddled with incompetence. From an economics spokesperson who stated that debt and the deficit are the same thing to an environment minister who thought she'd win brownie points from Osborne and Cameron by savagely slashing flood defence spending, only for several of the places that had their flood defence schemes cancelled to suffer £billions worth of flood damage in the following years.

Until Iain Duncan Smith quit the DWP, David Cameron's government operated on a tripod of abject incompetence, with IDS as one leg, and George Osborne and Theresa May as the others.

I could go on for paragraph after paragraph about the incompetence of these three individuals, but I'll just give one example for each for the sake of brevity.

Perhaps the worst thing of all is that even after six years of such incompetence, two of them are still in their jobs, and the other one was allowed to quit rather than get fired!

Conclusion

I will never join the Tory party, and it's always best to read the article before getting outraged about the title (especially when the date is April the 1st!).

  
 Another Angry Voice  is a "Pay As You Feel" website. You can have access to all of my work for free, or you can choose to make a small donation to help me keep writing. The choice is entirely yours.






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