Do YOU feel as prosperous as you were before the crisis?

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[Image: David Symonds for The Guardian, in February this year.]

Britain has returned to prosperity, with the economy finally nudging beyond its pre-crisis peak, according to official figures.

Well, that’s a relief, isn’t it? Next time you’re in the supermarket looking for bargains or mark-downs because you can’t afford the kind of groceries you had in 2008, you can at least console yourself that we’re all doing better than we were back then.

The hundreds of thousands of poor souls who have to scrape by on handouts from food banks will, no doubt, be bolstered by the knowledge that Britain is back on its feet.

And the relatives of those who did not survive Iain Duncan Smith’s brutal purge of benefit claimants can be comforted by the thought that they did not die in vain.

Right?

NO! Of course not! Gross domestic product might be up 3.1 per cent on last year but it’s got nothing to do with most of the population! In real terms, you’re £1,600 per year worse-off!

The Conservatives who have been running the economy since 2010 have re-balanced it, just as they said they would – but they lied about the way it would be re-balanced and as a result the money is going to the people who least deserve it; the super-rich and the bankers who caused the crash in the first place.

You can be sure that the mainstream media won’t be telling you that, though.

Even some of the figures they are prepare to use are enough to cast doubt on the whole process. The UK economy is forecast to be the fastest-growing among the G7 developed nations according to the IMF (as reported by the BBC) – but our export growth since 2010 puts us below all but one of the other G7 nations, according to Ed Balls in The Guardian.

And it is exports that should be fuelling the economy, according to JML chairman John Mills in the Huffington Post. He reckons the government needs to invest in manufacturing and achieve competitive exchange rates in order to improve our export ability.

“Since most international trade is in goods and not in services, once the proportion of the economy devoted to producing internationally tradable goods drops below about 15 per cent, it becomes more and more difficult to combine a reasonable rate of growth and full employment with a sustainable balance of payments position,” he writes.

“In the UK, the proportion of GDP coming from manufacturing is now barely above 10 per cent. Hardly surprising then that we have not had a foreign trade surplus balance since 1982 – over thirty years ago – while our share of world trade which was 10.7 per cent in 1950 had fallen by 2012 to no more than 2.6 per cent.”

All of this seems to be good business sense. It also runs contrary to successive governments’ economic policies for the past 35 years, ever since the neoliberal government of Margaret Thatcher took over in 1979.

As this blog has explained, Thatcher and her buddies Nicholas Ridley and Keith Joseph were determined to undermine the confidence then enjoyed by the people who actually worked for a living, because it was harming the ability of the idle rich – shareholders, bosses… bankers – to increase their own undeserved profits; improvements in working-class living standards were holding back their greed.

In order to hammer the workers back into the Stone Age, they deliberately destroyed the UK’s manufacturing and exporting capability and blamed it on the unions.

That is why we have had a foreign trade deficit since 1982. That is why our share of world trade is less than one-third of what it was in 1950 (under a Labour government, notice). That is why unemployment has rocketed, even though the true level goes unrecognised as governments have rigged the figures to suit themselves.

(The current wheeze has the government failing to count as unemployed anyone on Universal Credit, anyone on Workfare/Mandatory Work Activity and anyone who whose benefit has been sanctioned – among many other groups – for example.)

You may wish to argue that the economy is fine – after all, that’s what everybody is saying, including the Office for National Statistics.

Not according to Mr Mills: “The current improvement in our economic performance, based on buttressing consumer confidence by boosting asset values fuelled by yet more borrowing, is all to unlikely to last.”

(He means the housing bubble created by George Osborne’s ‘Help to Buy’ scheme will burst soon, and then the economy will be right up the creek because the whole edifice is based on more borrowing at a time when Osborne has been claiming he is paying down the deficit.)

Ed Balls has got the right idea – at least, on the face of it. In his Guardian article he states: “We are not going to deliver a balanced, investment-led recovery that benefits all working people with the same old Tory economics,” and he’s right.

“Hoping tax cuts at the very top will trickle down, a race to the bottom on wages, Treasury opposition to a proper industrial strategy, and flirting with exit from the European Union cannot be the right prescription for Britain.” Right again – although our contract with Europe must be renegotiated and the Transatlantic Trade and Investment Partnership agreement would be a disaster for the UK if we signed it.

But none of that affects you, does it? It’s all too far away, controlled by people we’ve never met. That’s why Balls focuses on what a Labour government would do for ordinary people: “expanding free childcare, introducing a lower 10p starting rate of tax, raising the minimum wage and ending the exploitative use of zero-hours contracts. We need to create more good jobs and ensure young people have the skills they need to succeed.”

And how do the people respond to these workmanlike proposals?

“You intend to continue the Tories’ destructive ‘austerity’ policies.”

“The economy isn’t fixed but you broke it.”

There was one comment suggesting that all the main parties are the same now, which – it has been suggested – was what Lynton Crosby told David Cameron to spread if he wanted to win the next election.

Very few of the comments under the Guardian piece have anything to do with what Balls actually wrote; they harp on about New Labour’s record (erroneously), they conflate Labour’s vow not to increase borrowing with an imaginary plan to continue Tory austerity policies… in fact they do all they can to discredit him.

Not because his information is wrong but because they have heard rumours about him that have put them off.

It’s as if people don’t want their situation to improve.

Until we can address that problem – which is one of perception – we’ll keep going around in circles while the exploiters laugh.

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If Osborne’s critics are wrong, why did the economy do exactly what we said?

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austerity, benefit, claimant, cycle, death, economic, economy, fiscal, George Osborne, growth, help to buy, housing bubble, Iain Duncan Smith, inflation, keynes, long term, manipulate, manipulating, manipulation, Media, Mike Sivier, mikesivier, plan, purge, recovery, stagnation, stimulus, UK, unemployment, Vox Political, wage

What an embarrassment: George Osborne should be ashamed of the rubbish he spouted in his speech yesterday (Friday).

George Osborne is flailing.

He’s a desperate man, trying vainly to convince us that the current state of the British economy was his plan all along when anybody with half a brain can see it wasn’t.

Yesterday he was in Washington, trying to convince Americans that he knows what he is doing, but US economists are far too canny to accept anything he says at face value.

His principal claim was that critics of what he and the ConDem inner circle still laughably call “the government’s long-term economic plan” have been proved “comprehensively wrong”. Some of us would like to see his proof of that.

Back in 2010, when Osborne took over at the Treasury, trashed a perfectly good Labour-stimulated recovery and sent the economy into freefall, those of us with any sense said the situation would worsen until it hit the point at which the economy would stabilise of its own accord, without any interference from politicians. Then it would start to improve because demand would start to rise again.

We reached the lowest point possible in the British economic cycle; from there, the only way was up. That is why there is a recovery – and a mean, meagre little thing it is, too. We should be 20-25 percentage points above where we are. Instead, we’re 1.4 per cent behind our pre-recession peak and the money is going to the wrong people.

The only question you should be asking is why this Tory illiterate has held us back.

Osborne told America that the British economy was growing faster than any other in the G7 – which means nothing. When an economy has shrunk more than any other, it is easier for it to grow. It doesn’t mean that our economy will be bigger than the others, although that is certainly the impression that Osborne wants to convey.

He said the growth was “despite warnings from some that our determined pursuit of our economic plan made that [economic growth] impossible”. This was a lie.

Osborne knows perfectly well that nobody said growth was impossible. They said Osborne’s policy would delay any recovery, causing misery for millions of medium- and low-waged people and providing a spurious justification for his colleague Iain Duncan Smith’s purges of benefit claimants – actions that have caused many thousands of unnecessary deaths.

Apparently, to quote members of a previous Tory government, that is “a price worth paying”. For what?

He said: “Fiscal consolidation [austerity] and economic recovery go together, and [the economic turnaround in the UK] undermines the pessimistic prognosis that only further fiscal stimulus can drive sustainable growth.” This is not what the data shows. It shows, as already stated, that the British economy hit rock-bottom under Osborne’s guidance and has now started the long climb upward of its own accord. That is not an endorsement of his policy; fiscal stimulus along Keynesian lines would have arrested the decline and boosted the economy back into growth – as evidenced four years ago, when Osborne inherited an economy that had been growing for five consecutive quarters and sent it right back into decline.

Osborne claimed, yet again, that a Keynesian scheme would create more debt – denying the simple economic fact that the boost it would have provided would have put more money into the Treasury and cancelled the debt far more quickly than his cuts.

It’s obvious, really. Any growth is despite austerity, not because of it. If you take money out of a system, it’s harder for anybody to make a profit on which tax can be paid. Economics 101, George. But you studied history, didn’t you? And towel-folding.

We should also remember that in Osborne’s first Budget he promised – promised – a “steady and sustained” economic recovery. Instead, we had three years in which the economy flatlined. Then he brought in ‘Help to Buy’ – a very crude fiscal stimulus scheme that has created a housing price bubble that is hugely damaging for low earners while putting money into the pockets of people who don’t need it. The economy picked up, because housing relies on other industries, but the crash that is to come might create a worse situation than before.

Osborne wants us to believe that wages will start to rise above inflation, even though the experience of the Americans to whom he delivered his speech is that 95 per cent of post-recession growth went to the richest one per cent of the population. He wants us to believe living standards will improve, but there is no evidence for this at all.

It’s all just another big lie.

Just take a look around you and you’ll see the facts. Osborne was charged with keeping the economy on its knees because that is what the Tories needed, in order to suck the cash from the middle-class, working-class and unemployed people of the UK.

Tories need mass unemployment to maintain the UK as a low-wage economy, creating more profit for bosses while keeping the workers under the cosh.

They need stagnation in much of the economy in order to ensure that the deficit does not go away and the national debt rises, thereby making it possible from them to continue selling off the National Health Service and dismantling the welfare state.

They need a housing bubble in places like London, to ensure that it is too expensive for undesirable poor and middle-income people, ship them out to other towns that have suffered the planned decimation of their economic bases (in order to ensure that they could not make a better living there), and make the capital city a playground for the rich.

And they have done it all by manipulating the media into telling you the worst lies about your own well-being – lies like those in George Osborne’s speech yesterday.

The last 40 years of British history represent the worst decline in living standards for the British people in the entire history of our nation. Never before did we have as much as when the Conservatives came to office in 1979; never before did we have so much to lose.

And we gave it away to liars like George Osborne, just because they had honey on their forked tongues.

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Coalition: Put your own house in order before you patronise foreigners about disability

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Lynne Featherstone: Her speech may have been well-intentioned, but was also patronising and hypocritical in the light of the Coalition’s treatment of disabled people in the UK.

Today the Coalition government announced it is showing the developing world how to treat people with disabilities (don’t laugh) – by ensuring that schools built with direct UK funding will have easy access for the disabled.

According to a government press release, Liberal Democrat International Development Minister Lynne Featherstone used the High Level Meeting on Development and Disability at the United Nations in New York – the biggest disability rights meeting in five years – to call on the international community to tackle the ‘great neglect’ of a billion people globally who face unequal access to education, employment, healthcare, social support and justice as a result of disability.

Did her speech make any mention of the ‘great neglect’ of people in her own country who face discrimination on exactly the same grounds, caused by her government?

“Those living with a disability are disproportionately some of the poorest and most marginalised people in the world – part of an unseen great neglect,” she told the meeting. “It is telling that of the 57 million children currently out of school in the world today, over a third have a disability.

“As a global community, we have a duty to safeguard the most vulnerable. If developing countries are to move forward into prosperity and greater self-reliance, they must take everyone on the journey.

“That’s why from this day forward, all schools built with the direct support of British taxpayers will be designed to allow disability access.

“With the ongoing discussion of what development should focus on when the Millennium Development Goals expire in 2015, we have a once-in-a-generation chance to finally put disability on the agenda.”

Leaders of developing countries would have been justified in looking askance at the British minister while she was making this speech, with her hypocrisy on display for everybody to see.

They would be right to ask themselves: “Is this not a minister from a country that demonises its disabled people? That treats them as a burden on the community? That is trying to purge its society of them?

“Did her government not drive 73 disabled people per week to suicide or death through the exacerbation of their health problems – both brought on by cuts to state benefits and the threat of destitution – during 2011? And is her government not now refusing to provide up-to-date figures on the deaths its policies have caused?

“Does this not mean that deaths of disabled people caused – directly or indirectly – by UK government policies have increased dramatically during this time period, and the same government is trying to cover up the fact?”

It is notable that the government’s announcement landed on the same day that disability activist Samuel Miller received the following correspondence from the office of the UN’s special rapporteur on extreme poverty and human rights:

“On behalf of the Special Rapporteur, thank you very much for your communications… Ms Sepulveda is observing very closely the situation with the UK welfare policies and their effects on persons living in poverty, including persons with disability.

“She is doing her best within the limits of her mandate to address such situations not only in the UK but globally through direct engagement with Governments.

“She would like to commend you for your tireless efforts and wishes you all the best in your endeavours.”

In the light of all this, would leaders of developing countries not be right, while thanking the UK government for its well-intentioned offer, to ask why Ms Featherstone feels justified in talking down to them about the disabled when her government refuses to allow those in its own country an opportunity to live with dignity.