Politics Above Everything
It is worth a short reprise of last week's verdict on the government's strategy: GDP down by 0.3 per cent in 2012, still lower than 2008; manufacturing down 1.5 per cent and services flat; the only positive boost coming from a fortunately timed Olympic games. The coalition government in compromised bond founded on the need to turn around the economy, to rebalance the economic base, is failing on all fronts. Despite the overwhelming evidence the chancellor remains stoically convinced current policy is correct.
Politics and economics is essentially cyclical, especially so in the last fifty years, so it is not necessary to dust off ancient archives to identify similar circumstances and to compare the decision making at the time and consider the impacts of the choices made.
The 1979 Thatcher government came into power on the perceived failure of the Labour regime. Unemployment was at 1.2 million, the 'Labour isn't working' slogan is seminal in modern political history. The economic order of the day, although with a different objective to the current government - hauling down inflation as opposed to the single focus of reducing the deficit - the single policy lever was to take money out of the economy through massive spending cuts.
Even though unemployment had more than doubled to 2.7 million by 1981, including an unemployment rate of 60 per cent among young black men, then Chancellor Geoffrey Howe announced cuts of £4billion in the budget. Voices within cabinet were getting anxious. Ian Gilmour resorting to Churchillian references urging colleagues to 'look at the results ... however beautiful the strategy may be' - to look not just at the ideology of the policy, but its impact.
Thatcher, 'not for turning', mocked dissenters as 'wet' and told the Conservative Conference that 'This is the road I am resolved to follow. This is the path I must take.' an evangelical commitment resonant of Osborne's dogmatic adherence to 'plan A' despite a growing chorus of dissenters and rapidly declining public support.
What followed the monetarist policy of the early Thatcher government was some of the worst riots in modern British history, in Brixton, Southall and the worst in Toxteth in Liverpool, among others. Michael Heseltine, wrongly smeared as 'wet', fronted the government's response in the City and eventually secured significant efforts to support employment and growth, but only after a damning internal report significantly titled 'It Took a Riot' calling for a more interventionist industrial and social policy.
The leaders of Newcastle, Liverpool and Sheffield have recently published an open letter suggesting that there is a current risk of civil disturbance in the same vein as large swathes of our communities, especially young men, face long periods of unemployment and increasingly little hope of decent work as the economy continues to falter. It took several riots in the early 1980s for the government of the day to realise that the impact of policy was more important than the ideology inspiring it. Let's hope Osborne appreciates that sooner.
Kevin Rowan
Regional Secretary
Northern TUC
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