Friday 7 December 2012

Three things you need to know about the Autumn Statement

nef (the New Economics Foundation) has analysed the Autumn Statement and makes three observations:
  1. The Government’s economic policy is failing on its own terms
  2. The wrong people are paying for the economic crisis
  3. We need an economic strategy that invests in our future.
Most Liberator readers would agree with that critique, but there has been a tendency by most critics to focus on the first two points, when the third deserves more attention.

In the twenty-three years since the fall of the Berlin Wall and the alleged ‘end of history’, the left has failed to articulate an alternative to the prevailing economic orthodoxy (aka TINA = ‘There Is No Alternative’). Indeed, New Labour signed up to that orthodoxy (Peter Mandelson: “We are all Thatcherites now”). Even after the financial crisis of 2008, when it was pretty obvious that orthodox thinking was (in Adair Turner’s famous phrase) “a fairly complete train wreck of a predominant theory of economics and finance,” few have proposed anything more daring than tweaking the system.

Might this be because, during the 1980s, the left changed its focus to identity politics and a ‘rights’ agenda? Consequently, faced with an economic crisis, the instinctive response is to make competing claims on the welfare system instead of considering how we can create an economy that means fewer people are dependent on welfare in the first place.

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