Have there been spending cuts in Europe?

Short answer: Yes.

Via Tyler Cowen and the National Review comes this chart (click for big):

What it purports to show is that talk of "savage austerity" is overblown, that in fact no country has cut spending by more than a few billion, and that compared to 2002 levels (why 2002 is unclear) every country is spending considerably more.

Veronique de Rugy, who made the chart, does make passing reference to its major flaw, saying:

If this data were adjusted for inflation (which I would prefer but the data isn’t available) it would possibly show a decrease and certainly a flatter line for all countries.

Presenting such a chart using non-adjusted numbers is borderline dishonest. Flatlining spending in the UK, for instance, is a 3.5 per cent cut in real terms if there is 3.5 per cent inflation.

Tyler Cowen argues that using nominal figures is legitimate since nominal figures are what matter in the short run. If we accept that – or if we accept the easier-to-swallow response that an honest chart would show austerity but not "savage" austerity, or "large" spending cuts – then the next place to turn is to the receipts of spending.

What we find is, as Cowen puts it, a large increase in "automatic stabilizers", a Keynesian term which basically means that more people are claiming things like jobseeker's allowance, tax credits, and housing benefit as incomes go down and unemployment goes up.

These various expenditures are lumped together in the category of "mandatory spending". They are all expenses which governments promise to spend as needed, rather than from a fixed budget. If the number of unemployed people goes up, the amount spend on unemployment benefit goes up, and vice versa. Since the number of unemployed people has indeed gone up, we would expect mandatory spending to increase – as it has done.

In order for nominal spending to stay flat, as it has done, this increase in mandatory spending has to be offset by a decrease in "discretionary" spending – buying things that we actually want. As of the 2010 spending review, the Government was predicting a 26 per cent cut in the departmental spending limits by 2015, from 27 per cent of GDP to 20 per cent.

That is where the "large spending cuts" lie. But Cowen argues that:

That is not how people phrase it, rather they are complaining rather vociferously about "spending cuts," many of which are either imaginary or extremely small.

Perhaps Cowen is merely objecting to political rhetoric, in which case he is correct that "savage cuts to the discretionary budget which are partially offset by a growing mandatory budget" is more accurate, although less compelling, than "savage cuts". But if he is arguing that it is wrong to even claim that cuts exist, then he is being blinded by the same argument that has taken in Dan Hannan and Toby Young. As Daniel Elton puts it:

It is in effect saying "Yes, we realise that your Sure Start Centre has had to shut down, but because there’s a whole bunch of people now in the dole, there are no cuts"

Snip, snip: Have there been spending cuts? 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.

Grant Shapps on the campaign trail. Photo: Getty
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Grant Shapps resigns over Tory youth wing bullying scandal

The minister, formerly party chairman, has resigned over allegations of bullying and blackmail made against a Tory activist. 

Grant Shapps, who was a key figure in the Tory general election campaign, has resigned following allegations about a bullying scandal among Conservative activists.

Shapps was formerly party chairman, but was demoted to international development minister after May. His formal statement is expected shortly.

The resignation follows lurid claims about bullying and blackmail among Tory activists. One, Mark Clarke, has been accused of putting pressure on a fellow activist who complained about his behaviour to withdraw the allegation. The complainant, Elliot Johnson, later killed himself.

The junior Treasury minister Robert Halfon also revealed that he had an affair with a young activist after being warned that Clarke planned to blackmail him over the relationship. Former Tory chair Sayeedi Warsi says that she was targeted by Clarke on Twitter, where he tried to portray her as an anti-semite. 

Shapps appointed Mark Clarke to run RoadTrip 2015, where young Tory activists toured key marginals on a bus before the general election. 

Today, the Guardian published an emotional interview with the parents of 21-year-old Elliot Johnson, the activist who killed himself, in which they called for Shapps to consider his position. Ray Johnson also spoke to BBC's Newsnight:


The Johnson family claimed that Shapps and co-chair Andrew Feldman had failed to act on complaints made against Clarke. Feldman says he did not hear of the bullying claims until August. 

Asked about the case at a conference in Malta, David Cameron pointedly refused to offer Shapps his full backing, saying a statement would be released. “I think it is important that on the tragic case that took place that the coroner’s inquiry is allowed to proceed properly," he added. “I feel deeply for his parents, It is an appalling loss to suffer and that is why it is so important there is a proper coroner’s inquiry. In terms of what the Conservative party should do, there should be and there is a proper inquiry that asks all the questions as people come forward. That will take place. It is a tragic loss of a talented young life and it is not something any parent should go through and I feel for them deeply.” 

Mark Clarke denies any wrongdoing.

Helen Lewis is deputy editor of the New Statesman. She has presented BBC Radio 4’s Week in Westminster and is a regular panellist on BBC1’s Sunday Politics.