And from another perspective, of course, Osborne has been one of the Conservatives' most successful chancellors. He has used the financial crisis to advance the interests of capital in ways that would have seemed impossibly radical before 2008. The
measures offer clearer evidence yet of the Tory strategy of using the debt to
achieve long-desired political objectives.
Item 1 is
the cut to corporation tax, now to be reduced by 3% in April rather than the promised 2%, meaning an official rate of 21% from 26% last year: a full 5% reduction in the contribution from business at the very time they are in the dock for avoiding the tax they are supposed to pay. Osborne boasted of his generosity to corporates: 'This is the lowest rate of any major western economy. It is an
advert for our country that says: come here; invest here; create jobs
here; Britain is open for business.' The headline UK rate has already
been reduced from 26% to 24% this year. The rates of 40% in the US, 33% in France and 29% in Germany make it clear which Chancellor is really the capitalist's friend and help to explain why we can no longer afford to fund our public services.
Items 2
is cuts to welfare, with a three-year freeze meaning real reductions and real
hardship for all except pensioners. It is basic arithmetic to explain why those
on the lowest incomes can least afford to see their incomes squeezed by
inflation since the marginal impact on them of rising prices is so much strong. The justice of this situation is about not depriving the poor of the
means to survive, rather than some new conservative commitment to income
differentials. And meanwhile the stigmatisation of all those who claim welfare
(which is probably around 99% of us at some point in our lives) stokes the
fires of prejudice and fear.
The best news in the budget is the retreat from an earlier announcement of an end to national public sector pay. In the poorer areas of the country, nationally negotiated pay rates for
public-sector workers can keep local businesses afloat in desperate economic
times like these. Negotiating deals for teachers and doctors that relates to
local labour-markets would have sucked more money out of the regions, exacerbating the
inequalities between regions that have already increased throughout this
Recession. Presumably the U-turn here was a result of Liberal Democrat pressure.
The
'greenest government ever' banner now lies in tatters at the Chancellor's feet
as he lures investors into the sorts of developments that will drive economic
growth at any cost, threatens to abandon Labour's climate change targets, and
offers subsidies to the frackers. With 30 gas-fired power-stations looming and
the final abandonment of the fuel-duty escalator we can wave goodbye to any
hope of doing out part to prevent carbon dioxide emissions from spiralling out
of control.
The
language used by the Chancellor is also deceptive and oppressive, although I
find it helps to substitute the word 'capital' for the word 'business', making
sense of Osborne's repeated claims to be 'prioritising the interests of
business'. I am also intrigued by the constant repetition of the phrase 'the
economy is healing'. Is the personification of a complex system made up of a
mass of individuals supposed to win or empathy? Or to soften the perception of
the stark economic news? It is fairly clear that, rather than healing, the
economy is like a patient that has been stitched up leaving a festering wound
inside. Proper healing would have required tackling the distorted financial and
monetary systems rather than ignoring their flaws and hoping that they will
somehow mend themselves.
.
Tweet
.
No comments:
Post a Comment