Are fiscal conservatives even certain of what they're arguing about?

One of the problems fiscal conservatives have is that most of them can't actually agree about what they are conservative about.

One of the problems fiscal conservatives have is that most of them can't actually agree about what they are conservative about. Debt? Deficit? Absolute, or relative? And how should we talk about the issue?

For instance, one would guess from their name that deficit hawks care about the deficit – that is, the amount that a country spends each year in excess of the amount of revenue it receives, officially called (in Britain, at least) public sector net borrowing (PSNB). Last year, PSNB stood at a shade over £120bn, and this year, it's forecast to be £91.9bn. That's the government's deficit reduction strategy at work, albeit at far slower work than we were promised in 2010.

But other fiscal conservatives go after debt (the official measure of which, Public Sector Net Debt, stands at £1.03trn). Fraser Nelson, for instance, condems the elision between the two in today's Telegraph:

Cameron faces the same problem. He says he is “dealing with the debt” when he is actually increasing the national debt by as much as Labour proposed: an almighty £600 billion. But he has not yet been rumbled. An unpublished YouGov poll by Policy Exchange, taken after last year’s Budget, found that just 14 per cent of voters realised the national debt is rising. Another poll, released this week, found that only 10 per cent see what’s going on. Now, just as under Labour, ministers play word games and talk about “cutting the deficit”, knowing that most voters will hear “cutting the debt”. Astonishingly, almost half of British voters think that debt is falling.

It's certainly the case that debt is rising, and will be rising for some time. And confusing debt and deficit – as, say, Nick Clegg does – is unacceptably economically illiterate. But it's unclear how, exactly, being a "debt hawk" would work.

It is emphatically not the case that Britain can begin reducing its debt any time soon. For all that Nelson attacks the government for increasing the national debt, to reduce it would entail turning a deficit into a surplus overnight. Just considering the pain involved in entering into a seven-year deficit reduction program, doing it any faster would be politically impossible.

And in fact, given the various multipliers in effect from government spending, it may be economically impossible as well. There is strong evidence to suggest that the mere fact of trying to cut the deficit too quickly led to the contraction we're now experiencing; and that contraction has reduced government revenue and increased mandatory spending to a degree that makes it difficult to do any deficit reduction at all.

Being a debt hawk would thus seem to necessarily imply being a deficit hawk, at least for the time being. When – if – the structural deficit is eliminated, then the two groups can argue over whether debt should start being reduced; but while there is a deficit, it's silly to pretend that national debt going up is somehow surprising, and unless you want to go full Paul Ryan, you aren't going to get rid of it in a year.

All of this confusion is compounded by the fact that if it's unclear what we ought to be trying to reduce, it's doubly unclear how we ought to go about measuring it. Debt hawks favour quoting absolute figures, like those I've used at the top of the post, because frankly one trillion pounds sounds a lot more than "65.7 per cent of GDP". Yet the latter is probably a more accurate representation of where we are; for one thing, it allows us to accurately compare the economic situation with similar ones from history, as this chart (from Wikimedia Commons) does:

And for another, it conveys an important truth about the debt, which is that we can shrink it in two ways: either by paying it off, or by growing our economy big enough that what's remaining doesn't matter. This is the truth behind arguments over "deficit reduction versus growth".

But there is an even better way to discuss the national debt that in terms of a ratio to GDP, and that is in terms of it's cost.

The only downside to having debt is that you have to pay interest on it. But more debt doesn't necessarily mean higher interest payments – in fact, it's the exact opposite. Joe Weisenthal explains:

Using data from Bloomberg, we looked at basically all of the big emerging and developed markets* with a big bond market, and good data on debt to GDP and decided to check to see if there was any connection at all between debt to GDP and the yield on their 10-year bonds.

The answer, quite clearly, is no.

In fact, using an exponential regression, we detect a slight shift down and to the right, meaning that the more debt a country has relative to its GDP, the cheaper it is to borrow.

As debt goes up, interest rates go down. So doubling debt doesn't double interest payments, and halving debt doesn't mean you pay half as much servicing it. In chart form, that claim looks like this:

 

Our interest rates are so ridiculously depressed at the moment that even though we've almost doubled our national debt to GDP ratio, the amount we pay to service our debt has barely gone up by half.

This is what the debt hawks should be looking at. Not debt to GDP, and certainly not absolute debt; nothing matters to debt except the cost of holding it. And that cost doesn't present a particularly compelling reason for cutting it.

Gold, as a common and universally accepted store of value, is particularly useful to illustrate stories about abstract economic concepts like debt. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Gender pay gap: women do not choose to be paid less than men

Care work isn’t going anywhere – and it’s about time we recognised which half of the population is doing it, unpaid.

Is it just me, or does Mansplain The Pay Gap Day get earlier every year? It’s not even November and already men up and down the land are hard at work responding to the latest so-called “research” suggesting that women suffer discrimination when it comes to promotions and pay. 

Poor men. It must be a thankless task, having to do this year in, year out, while women continue to feel hard done to on the basis of entirely misleading statistics. Yes, women may earn an average of 18 per cent less than men. Yes, male managers may be 40 per cent more likely than female managers to be promoted. Yes, the difference in earnings between men and women may balloon once children are born. But let’s be honest, this isn’t about discrimination. It’s all about choice.

Listen, for instance, to Mark Littlewood, director general of the Institute of Economic Affairs:

“When people make the decision to go part time, either for familial reasons or to gain a better work-life balance, this can impact further career opportunities but it is a choice made by the individual - men and women alike.”

Women can hardly expect to be earning the same as men if we’re not putting in the same number of hours, can we? As Tory MP Philip Davies has said: “feminist zealots really do want women to have their cake and eat it.” Since we’re far more likely than men to work part-time and/or to take time off to care for others, it makes perfect sense for us to be earning less.

After all, it’s not as though the decisions we make are influenced by anything other than innate individual preferences, arising from deep within our pink, fluffy brains. And it’s not as though the tasks we are doing outside of the traditional workplace have any broader social, cultural or economic value whatsoever.

To listen to the likes of Littlewood and Davies, you’d think that the feminist argument regarding equal pay started and ended with “horrible men are paying us less to do the same jobs because they’re mean”. I mean, I think it’s clear that many of them are doing exactly that, but as others have been saying, repeatedly, it’s a bit more complicated than that. The thing our poor mansplainers tend to miss is that there is a problem in how we are defining work that is economically valuable in the first place. Women will never gain equal pay as long as value is ascribed in accordance with a view of the world which sees men as the default humans.

As Katrine Marçal puts it in Who Cooked Adam Smith’s Dinner?, “in the same way that there is a ‘second sex’, there is a ‘second economy’”:

“The work that is traditionally carried out by men is what counts. It defines the economic world view. Women’s work is ‘the other’. Everything that he doesn’t do but that he is dependent on so he can do what he does.”

By which Marçal means cooking, cleaning, nursing, caring – the domestic tasks which used to be referred to as “housework” before we decided that was sexist. Terms such as “housework” belong to an era when women were forced to do all the domestic tasks by evil men who told them it was their principal role in life. It’s not like that now, at least not as far as our mansplaining economists are concerned. Nowadays when women do all the domestic tasks it’s because they’ve chosen “to gain a better work-life balance.” Honestly. We can’t get enough of those unpaid hours spent in immaculate homes with smiling, clean, obedient children and healthy, Werther’s Original-style elderly relatives. It’s not as though we’re up to our elbows in the same old shit as before. Thanks to the great gods Empowerment and Choice, those turds have been polished out of existence. And it’s not as though reproductive coercion, male violence, class, geographic location, social conditioning or cultural pressures continue to influence our empowered choices in any way whatsoever. We make all our decisions in a vacuum (a Dyson, naturally).

Sadly, I think this is what many men genuinely believe. It’s what they must tell themselves, after all, in order to avoid feeling horribly ashamed at the way in which half the world’s population continues to exploit the bodies and labour of the other half. The gender pay gap is seen as something which has evolved naturally because – as Marçal writes – “the job market is still largely defined by the idea that humans are bodiless, sexless, profit-seeking individuals without family or context”. If women “choose” to behave as though this is not the case, well, that’s their look-out (that the economy as a whole benefits from such behaviour since it means workers/consumers continue to be born and kept alive is just a happy coincidence).

I am not for one moment suggesting that women should therefore be “liberated” to make the same choices as men do. Rather, men should face the same restrictions and be expected to meet the same obligations as women. Care work isn’t going anywhere. There will always be people who are too young, too old or too sick to take care of themselves. Rebranding  this work the “life” side of the great “work-life balance” isn’t fooling anyone.

So I’m sorry, men. Your valiant efforts in mansplaining the gender pay gap have been noted. What a tough job it must be. But next time, why not change a few nappies, wash a few dishes and mop up a few pools of vomit instead? Go on, live a little. You’ve earned it. 

Glosswitch is a feminist mother of three who works in publishing.