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Laurie Penny: Don't be fooled by the Fred Goodwin sideshow

Gesture politics are good for only one thing: taking the edge off public outrage.

Bang goes the knighthood. Last week, one of the men most responsible for the financial crisis in Britain was stripped of his honorary title by the queen, following public outrage around the extravagant bonus that was due to be lavished upon his successor. The former Sir Fred Goodwin was chief executive of the Royal Bank of Scotland, which had to be bailed out by the British taxpayer and is still largely publicly owned. It is somewhat of an indictment on the limp, panting capitulation of the so-called opposition in Britain today that the confiscation of this meaningless imaginary trinket by the constitutional monarch actually looks like rebellion of a sort.

Every party has joined in the scrum for empty symbolic gestures to placate creeping public fury against bankers. The unfairness is terrifically difficult to spin: as disabled people and terminally ill cancer patients are threatened with pauperisation by the state, there are those at the top to whom the much vaunted "end of the something-for-nothing culture" seems by some margin not to apply. We are supposed to applaud meekly at this point. We are supposed to clap and be quiet as one or two of the best-reported travesties of financial feudalism are rectified in a manner likely to make little practical difference to the current and former chief executives of RBS, who remain fabulously wealthy men. Removing knighthoods from bank directors, of course, is no likelier to democratise contemporary capitalism than spending the winter in a tent city - like the Occupy protests, the trend is a portent rather than an agent of change. But what change?

Many liberal critics have grudgingly conceded that the removal of Fred Goodwin's knighthood and Stephen Hester's bonus are a step in the right direction. They are absolutely no such thing. They are a vacuous, cynical sideshow designed to distract attention from the fact that not a bloody thing is being done to rein in the power of the financial sector to do precisely whatever the hell it likes and force the global poor to pick up the tab. Away from the field of the symbolism Cameron and his Bullingdon bag-carriers have been lobbying hard at Davos against the proposed EU financial transactions tax, which might actually oblige actual banks to take slightly fewer crazy risks with other people's money. It's not much. It won't do anything to combat wage repression or the exploitation of workers on the breadline in Europe, and its sub-clauses make it laughably escapable for the larger multinationals, but it's a start - and our government is determined to stop it. It's okay, though, because Fred the Shred is no longer a knight of the realm.

Goodwin's humiliation is part of a broader cultural trend: the suggestion that the worst excesses of capitalism can be reined in by authoritarianism. You see it when the Archbishop of Canterbury suggests that bankers' bonuses and urban riots are equivalent symptoms of moral decline rather than of economic chaos - although they hardly come with equivalent penalties. You see it when the MP for Tottenham suggests that we'd have had fewer riots if only black and working-class youths had been beaten more thoroughly in childhood.

Free-market feudalism adapts to survive. Capitalism has always been able to neutralise its own discontents by absorbing them, and the politics of moral gesture are fast becoming a part of that process. There is an idea slowly growing in the public consciousness that Queen, country, duty, respect, faith and family can get us out of this fix. Removing a piece of royal frippery from a man who can do no more damage to our economy is part of this new code, the idea that fiscal ethics can be played out purely in the terrain of symbolism - although the young people serving jailtime for celebrating the August riots on Facebook could be forgiven for failing to see anything symbolic about their prison walls.

Gesture politics are good for only one thing: taking the edge off public outrage. Ultimately, walloping individual city workers is no more likely to make them behave than brutalising poor children is likely to keep them quiet the next time a young man is gunned down by police in inner London. All of this showmanship is about mood management - as if the entire country had been invited to go away and punch a pillow until we feel a bit calmer.

Gesture politics can give us a dirty thrill, but that's all they can do. We could insist that a tithe of bankers be sent every year to be publicly spanked with a traditional bristle birch in Hyde Park by a cohort of unemployed, low-waged and disabled people and indignant left-wing bloggers, and I'm sure we'd all feel a bit better about things, but at the end of the day they would still walk away rich and we would walk away poor. The idea that Britain is undergoing a moral rather than financial collapse - a moral collapse that can be rectified with selective public humiliation for the super-rich and beatings and prison for the rest of us - is not just deceptive. It's dangerous.

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

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Autumn Statement 2015: a test of competence as well as compassion

George Osborne's chickens may be coming home to roost.

The debate will be political and polarized, as you’d expect, when the Chancellor sets out the results of the Spending Review tomorrow and how his £20bn of savings will be realised. However my suspicion is that while many followers of the Westminster's circus are debating what it all means for compassionate or compassionless conservatism, the public will be more interested in a more straightforward question: one of competence. 

Strip away the hyperbole and the election in May was won on an assessment of which party was the more competent to govern. A huge part of the public’s judgment in this regard was to trust the track record of the Conservatives in balancing the books and that the £20bn in departmental savings earmarked was a reasonable and responsible ambition. 

This is the question in point because what the public did not endorse explicitly was significant change in the size and role of the state. The argument was made and won for a budget surplus, not necessarily for its consequences. As Paul Johnson of the IFS has been at pains to say after every recent budget.

We should acknowledge that one of the reasons the Chancellor does have the public’s confidence is that the cuts to public services so far have not been as damaging as many opponents predicted. The NHS is under-strain, but has not broken. Hard pushed local government leaders have managed to shield social care from the worst of the changes, and the majority of police officers lost were in the back-office not on the beat. So when pollsters ask the public whether they have noticed the effects of austerity, most say they haven't. 

Understanding what the implications are of further large reductions in areas in the firing line such as police forces or local government is hard to do. So the government has told the public "trust us". Now we are going to find out how well that trust was placed. The point is this though - if the public haven't yet felt the full affects of a smaller state they may not be so tolerant it if they do. That brings us to the Chancellor’s real test. The easy cuts have surely been made, after the long years of spending increases prior to 2010 you would expect the system to be able to tighten its belt. But with five years of austerity under that belt there is a risk that the additional cuts could push services too far. 

The public were told that £20bn of saving could be achieved without the kind of pain that will be felt if social care for the elderly really starts to fall over, if police officers become significantly more scarce, or if the NHS does need much more than the promised £8bn (as many believe it will). On this point they have trusted the Chancellor to understand the implications of what he is promising. So if the policy choices in the Spending Review turn out to show that he did not, it will be the Government's competence as much as its compassion that will concern the public.


Steve O'Neill was deputy head of policy for the Liberal Democrats until the election.