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Laurie Penny: A divided society

The chasm in our society is no longer between left and right, but between rich and poor.

For all the talk of one-nation Conservatism, the shadow-play of social injustice begins as soon as you step on to the train to the Tory party conference. Flinging my huge rucksack between the nearest doors just as the Birmingham train is about to pull away, I find myself moving through the low-lit hush of the first-class carriages. Wobbling through the half-empty aisles, I spot two Conservative councillors and several well-known columnists from the Times, the Guardian and the Telegraph curled comfortably in the spacious armchairs, over newspapers and coffee -- but through two sets of sliding doors are the cheaper seats.

Back here, it's stressful and there's not enough space. Standard class on the 8.50 Virgin Trains service is crowded with shift workers, students heading back to college after weekends at home -- and protesters. People from all corners of the country have given up their weekends to attend the national anti-cuts, pro-welfare demonstration convened by the Right to Work campaign and many of them are squeezed into the narrow red pens of Virgin's stock, shut off from the elbow-room of first class by a surcharge that makes all the difference. I drift off into a disturbing dream that Richard Branson is now running the welfare state, and several lurching delays later the denizens of standard class stumble out into Birmingham New Street, rumpled and irritable as only the British public can be after two hours crammed into a rolling metaphor for the state of the nation.

By noon, I am huddled in a car park under a dirty formica sky with several thousand welfare recipients, public-sector workers, local kids and union reps, getting thoroughly and miserably rained on. The press has dismissed the protest as union-led and union-run, because we now live in a world where "trade-union member" is a term of insult, but most of those I meet walking to the march assembly point are unaffiliated citizens. Kathryn, a teacher, says that this is her first protest since the Stop The War march in 2003. "It's mine, too," says Margaret, a retired social worker, who is marching alongside a gang of teenagers from local comprehensive schools. "I don't normally get involved in things like this, but this time, with these cuts, I just felt like I had to say something." "We've got to say something," agrees Kathryn. "It's better than staying quiet."

Everything's entirely quiet in the foyer of the Jury's Inn hotel where politicians and lobbyists are sipping tea in between fringe events. "It's hard to see how any protest will make much of a difference," says one Conservative MP, who refuses to be named. "Everybody knows that we have to make cuts anyway, so nobody's going to take much notice." Other delegates at the bar have heard that there's some sort of ruckus going on in the street, but the retreat into Tory bunker mentality has already begun. Despite this being the first conference in power the Conservatives have held for 14 years, the mood is far from triumphant -- at the fringe events, ministers are already on the back foot, defending the coalition's planned cuts to welfare and public services as calmly as possible.

Back at the march, a crosspatch cross section of British society is voicing its soggy dissent: pensioners grumble about the vehemence of some of the speakers while eating scotch eggs from plastic bags, and dreadlocked students share flasks of tea and foil-wrapped sandwiches with middle-aged mothers pushing prams. There's a curious sense of timelessness to the event. Some of the union reps clearly think they're back in the 1980s, and a dour close-harmony folk band is telling us all about the Hard Times of Olde England, but as the march moves off, it is led by disabled people in wheelchairs and their carers, determined to "show that we're suffering, too". At back of the folk band, moreover, is a man who everyone is trying very hard to ignore, because he is brandishing and occasionally honking through a vuvuzela, an item that seems in 2010 to have finally replaced the pitchfork as the prop of choice for the global working class attempting to annoy and terrify the bourgeoisie.

Meanwhile, just feet away inside the secure zone, behind a wall of steel cordons and police dogs, about the same number of warm, dry conference delegates are, and I'm not making this up, watching some contemporary dance. Specifically, a trio of twee pseudo-ballerinas in floaty saris from something called the Arts Conference, enacting modern interpretations of North Indian traditional dances with very serious expressions. They have been hired to twirl very slowly around the main stage before Francis Maude comes on to explain the "big society", and as he hasn't got a lot to say, they've clearly been instructed to take their time. The audience clap, polite and bewildered. Outside in the rain, the people who actually have to live in the "big society" are already howling for reprieve.

You couldn't have asked for a starker, more cliched illustration of the difference between the political elites and the rest of us if you'd given a toddler a fistful of red and blue crayons and told it to draw a picture of a divided society. The lines being drawn are wobbly and childish, but they are lines of pain and anger, and like the etchings of a traumatised child, they deserve to be paid attention to. The chasm in our society is no longer between left and right. The chasm is between rich and poor, and it's growing, dividing those members of the elite, including the liberal elite, for whom the coming cuts are an abstract if regrettable concept, and the people whose jobs and homes and families are under threat.

Most of the latter have not been able to afford the £400 accreditation process for access to the Conservative conference centre, with its finger-food receptions and winsome catered round tables to discuss whether central government should pull an awkward or merely resolved expression while tearing the heart out of the welfare state and refusing to share the financial burden amongst the wealthy. As delegates and journalists at the Demos grill nibble profiteroles and ask Greg Clark MP why he won't be slightly more forthright about shrinking the state, they seem not to have realised how much they are already resented by a good deal of ordinary people. Either that, or they simply don't care.

Laurie Penny is a contributing editor to the New Statesman. She is the author of five books, most recently Unspeakable Things.

Photo: Getty
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George Osborne's mistakes are coming back to haunt him

George Osborne's next budget may be a zombie one, warns Chris Leslie.

Spending Reviews are supposed to set a strategic, stable course for at least a three year period. But just three months since the Chancellor claimed he no longer needed to cut as far or as fast this Parliament, his over-optimistic reliance on bullish forecasts looks misplaced.

There is a real risk that the Budget on March 16 will be a ‘zombie’ Budget, with the spectre of cuts everyone thought had been avoided rearing their ugly head again, unwelcome for both the public and for the Chancellor’s own ambitions.

In November George Osborne relied heavily on a surprise £27billion windfall from statistical reclassifications and forecasting optimism to bury expected police cuts and politically disastrous cuts to tax credits. We were assured these issues had been laid to rest.

But the Chancellor’s swagger may have been premature. Those higher income tax receipts he was banking on? It turns out wage growth may not be so buoyant, according to last week’s Bank of England Inflation Report. The Institute for Fiscal Studies suggest the outlook for earnings growth will be revised down taking £5billion from revenues.

Improved capital gains tax receipts? Falling equity markets and sluggish housing sales may depress CGT and stamp duties. And the oil price shock could hit revenues from North Sea production.

Back in November, the OBR revised up revenues by an astonishing £50billion+ over this Parliament. This now looks a little over-optimistic.

But never let it be said that George Osborne misses an opportunity to scramble out of political danger. He immediately cashed in those higher projected receipts, but in doing so he’s landed himself with very little wriggle room for the forthcoming Budget.

Borrowing is just not falling as fast as forecast. The £78billion deficit should have been cut by £20billion by now but it’s down by just £11billion. So what? Well this is a Chancellor who has given a cast iron guarantee to deliver a surplus by 2019-20. So he cannot afford to turn a blind eye.

All this points towards a Chancellor forced to revisit cuts he thought he wouldn’t need to make. A zombie Budget where unpopular reductions to public services are still very much alive, even though they were supposed to be history. More aggressive cuts, stealthy tax rises, pension changes designed to benefit the Treasury more than the public – all of these are on the cards. 

Is this the Chancellor’s misfortune or was he chancing his luck? As the IFS pointed out at the time, there was only really a 50/50 chance these revenue windfalls were built on solid ground. With growth and productivity still lagging, gloomier market expectations, exports sluggish and both construction and manufacturing barely contributing to additional expansion, it looks as though the Chancellor was just too optimistic, or perhaps too desperate for a short-term political solution. It wouldn’t be the first time that George Osborne has prioritised his own political interests.

There’s no short cut here. Productivity-enhancing public services and infrastructure could and should have been front and centre in that Spending Review. Rebalancing the economy should also have been a feature of new policy in that Autumn Statement, but instead the Chancellor banked on forecast revisions and growth too reliant on the service sector alone. Infrastructure decisions are delayed for short-term politicking. Uncertainty about our EU membership holds back business investment. And while we ought to have a consensus about eradicating the deficit, the excessive rigidity of the Chancellor’s fiscal charter bears down on much-needed capital investment.

So for those who thought that extreme cuts to services, a harsh approach to in-work benefits or punitive tax rises might be a thing of the past, beware the Chancellor whose hubris may force him to revive them after all. 

Chris Leslie is chair of Labour's backbench Treasury committee.