We must break with this Westminster austerity consensus: Now this deficit mania has been extended to balancing the budget – which even the disastrously deflationary eurozone fiscal pact doesn’t demand of its members, but Labour has allowed itself to be sucked into endorsing. Not only has Ed Balls signed up to eliminating the deficit (which has averaged 2.4% over the past 66 years) during the next parliament, but apparently to reducing debt as a share of national income as well... by endorsing the goal of a balanced budget, Labour risks legitimising a City-driven austerity programme which is more about restoring profitability and appeasing corporate interests than about public sector housekeeping. The real problems of the British economy are miserably low private investment, falling wages and productivity, a broken banking system and mushrooming private debt: very similar, in fact, to those that helped trigger the crisis we are still living through, with the added threat of a new deflationary spiral in the eurozone. The only effective remedy is a public investment-led reconstruction of a broken economy. Parties that position themselves to Labour’s left – including the Greens, SNP and Plaid Cymru – are now demanding a break with austerity as a condition of support for a minority Ed Miliband government. One way or another, Osborne’s failure demands a real alternative.
Posted on: Thu, 18 Dec 2014 07:26:47 +0000
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