Before it’s too late let’s not let the window of opportunity pass us by. The government is us, or it could be.
As many of us sit in our living rooms watching TV it often feels that we are living in some sort of tragic farce being played out on the world stage. Or maybe even that we’ve been transported into the realms of the ‘imaginary’ Matrix of Agent Smith and Morpheus. It is difficult to know these days what is real, what is not or indeed what the future holds for us humans as Covid-19 brings a new normal and AI and automation becomes a seeming reality. We are coasting along perhaps hoping tomorrow will be another day and will bring better things.
Our illusory sense of stability and certainty is being replaced with deep anxiety. It is alarming for many to find that the foundations we have been standing on for decades were actually made of sand and prone to eventual collapse. On a daily basis, the pandemic reveals the gaping holes in public and social infrastructure provision that has resulted from over 40 years of neoliberal orthodoxy aided by the deeply held and politically inculcated public beliefs that there is always a price to pay for too much spending. We seem to have accepted instinctively that reducing inequality and poverty or addressing climate change is unachievable because governments are constrained by the scarcity of money. That nothing can be done.
We confuse Charles Dicken’s character Micawber’s dilemma as a currency user “Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery” by translating that same household budget narrative into how the UK government spends. Instead of understanding that governments are currency issuers and cannot be confused with currency users, we believe in a logical but mistaken fashion that after the big spend the government will, like Micawber, have to pull in its horns eventually if it is not to end up in debtors’ prison or be proscribed by the ratings agencies as not good credit risks.
The ’there is no alternative’ mantra lives on as if somehow the market is all-powerful and governments must bow down to its all-knowing nature. And yet none of this is true. Sovereign currency-issuing government like the UK and many others not only hold the key to finding solutions to the economic chaos that is currently before us and the future challenges we face but also have the keys to the public purse. Unlike the commonly believed narrative, neither the bond markets nor the taxpaying rich determine how much the government can borrow or spend. These are government decisions relating to a political agenda and political will to deliver it with the resources it has at its disposal. It is beautifully simple.
The wreckage of 10 years of austerity, deliberate and continued shrinkage of our publicly managed and paid for infrastructure, as well as the increases in poverty and inequality as a result of a low wage, precarious economy is strewn in its wake. Combined with the on-going consequences of the pandemic on the economy in the form of increasing levels of unemployment then things are looking distinctly worrying.
Already this week more redundancies have been announced with Pret a Manger indicating that 2700 people will lose their jobs at its branches across the country as cities become deserts devoid of workers looking for their lunch. These will not be the last. As has been pointed out in previous blogs, many more will find themselves without employment over the next few weeks and months as the Job Retention Scheme comes to a close when many employers will find themselves with no choice but to let their workforces go. As Frances Grady of the TUC indicated this week millions of jobs are at stake.
This is the government’s wakeup call, but it is important to understand that what comes next will be a political decision unrelated to the state of the public finances. When the Chancellor Rishi Sunak says that the nation must buckle up and prepare for hard times it is almost as if he is saying that what happens will be unavoidable. It is as if he is saying that the short spell of propping up the economy with a round of fiscal intervention is unsustainable and that he will have no choice but to bow to the dictates of the market. We will have no option but to take the pain (by which he means us) to sort out the mess which will clearly mean a reset of the economy even if that means huge unemployment whilst at the same time as he has already intimated getting deficits and debt down and the public finances back into order. A recipe for disaster.
His job retention scheme and the much-praised ‘eat out to help out’ have shown what government can do, but those programmes have quite simply been skirting around the edges in terms of what government must do if we are to avoid a collapse of the economy and further hardship for citizens. It is avoiding the opportunities that exist to address the key challenges which face us in terms of climate change and indeed that ‘levelling up’ which Boris Johnson has spoken about which will be essential to ensure a fairer distribution of wealth and resources across the population. The truth is that we need an expansion of the public sector alongside a Job Guarantee and Green New Deal if we are to confront and address these challenges directly and effectively.
The implication of Sunak’s statement is that the government is not in charge and does not have the tools to manage the worst economic effects of the pandemic, nor indeed of coming climate change which will demand big solutions not just for the health of the planet but human existence.
It’s the market, stupid! It’s not the fault of government! That is what they want us to believe. The blame game lives on and not just in terms of the neoliberal diktat that the invisible hand of the market rules the roost. Like a magician’s sleight of hand which draws our attention away from the real trick being played on us, government has used the same mechanisms to ensure that the public is not looking at what is really happening and why. And more importantly who is responsible.
Indeed, this week the news was encapsulated in Boris Johnson’s statement that we had a ‘mutant algorithm’ in our midst. The computer had messed up apparently. Never mind the uncomfortable fact that computer programmes and algorithms are only as good as the person who programmed them.
It has become an on-going cause of criticism of government’s handling of this crisis and in particular of the Prime Minister that it is always someone else’s fault for the train crash that is occurring. Who has not come in for the opprobrium of various government ministers when things have gone wrong? From teachers to nurses, to social care workers and now civil servants who have either been sacked or had to resign in recent weeks and months.
Melanie Stefan, a computational neurobiologist at Edinburgh University, puts it quite clearly in a tweet thread she posted on the ‘A’ level results scandal which has ruined the chances of so many young people.
“Saying the computer got it wrong is doing two things: It makes it sound accidental, as if that was never really the plan. And it makes it sound like some weird computer uprising with no human agency or oversight involved.
Both are untrue. Humans are behind this. Humans made decisions, and in this instance the decision to further disadvantage students from already disadvantaged schools. This is a scandal, and we should be angry”
The fact is that it is humans in the form of politicians, their economic advisers and journalists who have been pumping out the false narratives and apportioning blame, that are in fact responsible for the disaster that neoliberalism and austerity policies have wreaked upon societies across the world.
The current government has done everything it can to avoid scrutiny of its actions and blaming the algorithm is a symptomatic example of its failure to accept responsibility for its policies over the last ten years and their damaging consequences. Others have conveniently become the fall guys for government failure, whether it is ordinary people being characterised as lazy scroungers living off the state, those who have been given the task of implementing government policy or those who speak out against the system. Government has turned its back on democratic accountability, seeking others to blame whilst at the same time encouraging us to turn on each other thus weakening the power we have to force the changes we so desperately need through the ballot box.
As Mary Bousted from the National Education Union commented this week ministers have a duty to parliament to account and be held to account for the policies, decisions and actions of their departments. Instead, they are doing the very opposite.
Our democracy both at the national and local level is under attack, our public and social infrastructure in decay, poverty and inequality rife and growing. Only this week it was suggested that by abolishing 213 smaller councils in England and replacing them with 25 new local authorities could save over £3bn.
In an age where deliberate government-driven austerity has almost brought local authorities to the brink of financial failure, the idea of saving money might seem attractive. However, in reality, it represents a further hollowing out of local democracy and its replacement with an impersonal money saving approach that no longer takes account of local people’s needs or serves their communities with targeted policies.
When the need to cut costs because of an alleged scarcity of money drives policy and replaces the need to meet public purpose and well-being, whether it is at national or local level, then we have been led astray.
When our social security system fails to serve those in most need both in these difficult times and normal times with adequate financial support then it is time to question those who promote such policies on the grounds of unaffordability.
When our public services are squeezed financially or put out to tender or privatised resulting in poorer services then it is time to dissent.
When a county council announces its intention as it did this week to shut most of its children’s centres reducing them from 38 to 17 saying that buildings do not serve communities then it is time to protest. Replacing buildings with outreach workers who will contact families instead makes the future of society start to look bleak as increasing social isolation threatens those very families who depend on these meeting places for comfort, support and conversation to help them through difficult times.
Money, or claimed lack of it, lies behind the dismantlement of those structures which form the backbone of a healthy economy and healthy citizens.
While we allow ourselves to be influenced by the cleverly executed blame game, our society is being deprived of the means to achieve a stable and secure future.
Government is the currency issuer. It makes the decisions. It decides what and who it will spend on. The future will be bleak if we continue to allow our societal voice to be drowned in a sea of naysayers who tell us that money is scarce and that ultimately there is no alternative to fiscal discipline and book balancing and that after the spending must come a reckoning.
The only balancing we have to do is linked to deciding upon how the available resources will be deployed, what should be provided and how it will be distributed. The questions we need to ask as a matter of urgency is what sort of society do we want to live in? Those are political decisions, not monetary ones. And, even if the mountain seems unclimbable, if we want to change things then as Bill Mitchell has said ‘The government is us’. Or it could be if we want it to be.
Join our mailing list
If you would like GIMMS to let you know about news and events, please click to sign up here
Support us
The Gower Initiative for Money Studies is run by volunteers and relies on donations to continue its work. If you would like to donate, please see our donations page here