Skip to main content

Why does Ed Balls fall for Osborne’s voodoo economics?

Rising debt shows Tory economic strategy an unmitigated disaster for Britain’s finances

TORY efforts to portray George Osborne as an economic miracle worker repairing the damage caused by a public services-obsessed Labour government are increasingly in tatters.

Once again the reality of government revenues and borrowing offers a stark contrast to claims made by the Chancellor.

Despite the Office for National Statistics revealing that last month’s government borrowing was up £1.6 billion on September 2013, Osborne had nothing to say yesterday.

His version of voodoo economics envisages an economic recovery based on easing taxation on big business and the richest people in society while holding down working people’s living standards.

A pay freeze, reduced state benefits, higher VAT, rocketing rents, fares, heating, lighting and water bills, together with slashed public services, have had the combined effect of forcing working people to tighten their belts still further.

Constant pressure on the unemployed to take any job going or face a benefits sanction means that employers are able to offer work at minimum wage rates.

Hundreds of thousands of jobless people have opted for self-employment, competing for casual work with other desperate people and often taking home less than the minimum wage.

In such circumstances, it is scarcely surprising that income tax revenue is stagnant.

This is despite the government claim that it would make a priority of tackling tax evasion and what it calls “aggressive” tax avoidance.

Both the Tories and new Labour under Gordon Brown have regarded HM Revenue & Customs as an easy target for public expenditure cuts, resulting in employment levels being halved since 2005.

Perhaps Osborne and Brown believe that rich people feel a strong moral impulse to pay their fair share of taxation and don’t need rigorous oversight of their plethora of tax-reduction schemes.

Then again, perhaps they also believe that there are fairies living at the bottom of the 11 Downing Street garden.

The impressive TUC-organised Britain Needs a Pay Rise march and rally at the weekend hit the nail on the head, encapsulating the problem that the working class share of national income has been declining for almost four decades while that of the wealthy elite has expanded to the same degree.

Demanding a pay rise for suffering workers and claimants isn’t required just to assist the Chancellor to meet his economic targets.

It could be a first step towards reversing the decades-long robbery of workers by those who own the means of production, distribution and exchange — in other words, the capitalist class.

Higher wages, pensions and benefits is one part of a strategy that has to take in higher taxes on big business and the rich and public ownership of key sectors of the economy.

Labour continues to fight shy of a radical response to the conservative coalition’s austerity agenda that operates in the interest of the favoured few.

Its spokesman’s woeful rejoinder to the trenchant criticisms by trade unionists Len McCluskey, Mark Serwotka and Billy Hayes at the weekend rally speaks volumes for Labour’s austerity-lite approach.

The party had nothing to say about the TUC event, just as it always stands aloof from strike action by NHS and other public service workers.

As long as Labour insists on balancing the books and eradicating the national debt at the expense of working people rather than big business and the rich, it will fail to enthuse voters and risks losing to the Tories or a Tory-led coalition next May.

OWNED BY OUR READERS

We're a reader-owned co-operative, which means you can become part of the paper too by buying shares in the People’s Press Printing Society.

 

 

Become a supporter

Fighting fund

You've Raised:£ 13,288
We need:£ 4,712
3 Days remaining
Donate today