Thursday, November 26, 2015

Quote of the day 26th November 2015

"If I went to Brent Cross to buy a new sweater and decided not to get one because it was too expensive, would I be making an ideological statement about shopping?

Or Society?

Or the future of Mankind?

Or would I just be, like, putting up with my old sweater for the time being while I saved up for a new one?

In the past few years, whenever there has been a budget, or an autumn statement, I have been astonished to discover how ideological I am. Apparently my innocent view that it is a good idea to be able to pay for the goods you purchase makes me a small-state neo-liberal Tory free market fundamentalist. Which seems quite a complicated description for just wanting things to add up.

Austerity, apparently, is a philosophy, and you can be anti-it. But, really, who wants to be austere? We all like "stuff" and prefer not to be without it. We are all anti-austerity when the finances mean that we don't have to make difficult choices.

Today the Chancellor will announce the latest measures necessary for us to stop spending more than we are willing to pay for.

Already, in advance, this has been described as a vicious and unnecessary ideological attack on the state and our sense of communal obligation. Preposterously, one normally insightful columnist produced a piece of analysis headed 'Everything we hold dear is being cut to the bone. Weep for our country.' Blimey."

"The spearhead of this attack is the accusation (it is always made as an accusation) that the proportion of GDP spent by the sate will come down to something like 36 per cent whereas before 2010 it was more like 47 per cent. This call is supposed to show that the extremists (me for instance)are advancing the destruction of society through an ideological aversion to the state."

"Let's leave to one side the fact that 36 per cent of national income is quite a lot ... and consider the link being made between the 36 per cent figure and the size of the state. A moment's though reveals the attack as a confused mess.

First the proportion of national income spent by the state depends on two things. One of them, obviously, is the amount of government spending. the other - easy to miss, this one - is the amount of national income. When national income rises, a given amount of state spending will form a smaller proportion of GDP. But something else happens at the same time When national income rises, there are things that the government used to spend money on that it doesn't need to spend as much on. Benefits for unemployed people, for instance.

So the proportion of national income spent by the state is not a good measure of ideology."

"Tony Blair fought the 2001 election with his government spending a proportion of national income that was roughly 36 per cent, or perhaps a little less. Was this an ideological attempt to destroy the state?"

"The social structure wasn't collapsing in 2001 ... Yet now public spending will be the same proportion of a larger sum. We know, in other words, that we can afford reasonable services for the available sum because we had reasonable services in the past for less money."

"Yet clearly the autumn statement will involve choices. Between 2000 and 2006, Gordon Brown and Tony Blair engaged in a structural increase in public spending without a matching increase in taxation. You cannot do this for ever."

"Whatever the choice, one thing is clear. Two plus two has to equal four. However unpopular that is."

(Extracts from an article in The Times yesterday by Danny Finkelstein called "If you're anti-austerity, you can't do 2 + 2 = 4")

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