David Laws’s defence of spending cuts doesn’t stand up

The former cabinet minister is wrong to argue that the cuts will enable a strong recovery.

If the coalition is ever in need of a hagiographer, it need look no further than David Laws. The former chief secretary to the Treasury has penned an embarrassingly uncritical defence of the government's spending cuts for the Guardian.

He declares that 2011 is likely to be the year that "recovery is entrenched". What he fails to mention is that, thanks to the coalition's doctrinaire spending cuts, it will be an anaemic recovery at best, with growth proceeding at a slower pace than in the recoveries of the 1970s, 1980s and 1990s (judging by the Office for Budget Responsibility's own figures).

Elsewhere, Laws credits the decision to begin cutting spending last year with enabling higher-than-expected growth. In fact, the strong growth Britain experienced in 2010 was largely the result of the last Labour government's fiscal stimulus. As the Times's Anatole Kaletsky (£) wrote in October:

The trouble is that monetary and fiscal policies take a long time to work their way through the economy – typically, one to two years. Yesterday's robust growth figures reflect last year's decisions by the Bank and the previous government. They tell us nothing, and indeed may mislead us, about how the new government's fiscal measures will interact with the Bank's monetary policies in the years ahead.

Yet Laws makes no mention of the fiscal stimulus: a policy opposed, after all, by his Conservative allies.

He notes that the "Lib Dem-inspired increase in the personal income-tax allowance will boost the incomes of basic-rate taxpayers", but fails to add that the gains are meagre compared to the losses from the coalition's tax rises and welfare cuts. The decision to raise the income-tax threshold to £7,475 will benefit low-to-middle-income earners by roughly £170 a year.

But, as Gavin Kelly pointed out in a recent piece for the NS, this is not enough to offset the rise in VAT (which will cost each household approximately £520 a year), let alone the far larger tax-credit cuts.

Laws gives the appearance of someone who has never read any of the arguments against his position. His return to government is surely imminent.

George Eaton is political editor of the New Statesman.

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To the Commonwealth, "Global Britain" sounds like nostalgia for something else

And the former colonial subjects have a less rose-tinted view of the past. 

Earlier this month, Boris Johnson became the first British foreign secretary to visit the Gambia since independence. His visit came a few days before the inauguration of the Gambia's new President, Adama Barrow, who has signalled his intention to re-join the Commonwealth - an institution that his dictatorial predecessor had left in protest at its apparent "neo-colonialism".

Accusations of neo-colonialism, regrettably, seem to be of little concern to the foreign secretary. After Johnson committed himself to facilitating the Gambia's Commonwealth re-entry, he declared that "the strength of our partnerships show that Global Britain is growing in influence and activity around the world". 

His comments are the latest example of the government's Brexit mission-creep in its foreign engagements. Theresa May mentioned "Global Britain" no fewer than ten times in her Lancaster House speech last month, reminding us that Britain "has always looked beyond Europe to the wider world" and emphasising the UK's post-referendum desire to "get out into the world". Ministers' repeated subsequent referencing of Global Britain has almost come to the point of re-branding Great Britain itself. But now the government seems to be directly equating Global Britain with the Commonwealth, the organisation comprising most of the former territories of the British Empire. If the Commonwealth is wooing back former members and seemingly growing in stature, that must mean Global Britain is doing the same. The Gambia's proposed re-admission to the Commonwealth is reconfigured as a victory for British clout and prestige in the face of the Brexit naysayers.

But the Commonwealth cannot be a vehicle or front for Global Britain, on either a technical or political level. The Commonwealth emphasises that it is an organisation of 52 equal member states, without any preference in decision-making. India (population 1.26bn) and Tuvalu (10,000) are treated the same. The organisation is headquartered in London, receives the most money from Britain, and its members share elements of history, culture and political systems; but it is not a British organisation and will not take orders from the British government. Commonwealth states, particularly poorer ones, may welcome UK political, financial and developmental support, but will reject the spectre of neo-imperialism. Diplomats remark that their countries did not leave the British Empire only to re-join it through the back door. 

And yet, shorn of influence following the decision to leave the EU, and the single market so instrumental to British jobs and prosperity, the government is desperate to find an alternative source of both power and profit. The members of the Commonwealth, with their links of heritage and administration, have always been touted as the first choice. Leading Brexiter Dan Hannan has long advocated a "union with the other English-speaking democracies", and Liam Fox has been actively pursuing Commonwealth countries for trade deals. But the Commonwealth cannot replace the EU in any respect. While exports to the EU account for just under a half of Britain's total, the Commonwealth receives less than 10 percent of our goods. The decline of UK trade with the Commonwealth was taking place long before Britain joined the EU, and it has in fact revived in recent years while being a member. The notion that Britain is restricted from trading with the Commonwealth on account of its EU membership is demonstrably false.  

The EU, the beloved scapegoat for so many ills, cannot fulfil the role for much longer. Indeed, when it comes to the Commonwealth, 48 of the 52 members have already completed trade deals with the UK, or are in the process of negotiating them, as part of their engagement with the EU. Britain could now be forced to abandon and re-negotiate those agreements, to the great detriment of both itself and the Commonwealth. Brexiters must moreover explain why Germany, with a population just 25 percent larger than ours, exports 133 percent more to India and 250 percent more to South Africa than we do. Even New Zealand, one of Britain's closest allies and a forthcoming trade-deal partner, imports 44 percent more goods and services from Germany, despite enjoying far looser cultural and historical ties with that country. The depth of Britain's traditional bonds with the Commonwealth cannot, in itself, boost the British economy. The empire may fill the imagination, but not a spreadsheet.

The British imperial imagination, however, is the one asset guaranteed to keep growing as Brexit approaches. It is, indeed, one of the root causes of Brexit. Long after the empire fell into history, the British exceptionalism it fostered led us to resent our membership of a European bloc, and resist even limited integration with it. The doctrine of "taking back control" for an "independent Britain" speaks to profound (and unfounded) anxieties about being led by others, when in our minds we should be the ones explicitly leading. The fictional, if enduringly potent victim narrative that we became a colony of someone else's empire, has now taken hold in government. The loss of our own empire remains an unacknowledged national trauma, which we both grieve and fail to accept. The concept of being equal partners with like-minded countries, in a position to exert real, horizontal influence through dialogue, cooperation and shared membership of institutions, is deemed an offence to Britain's history and imperial birthright.

The relentless push for Global Britain is thus both a symptom and cause of our immense global predicament. Through an attempt to increase our power beyond Europe, Brexit has instead deflated it. Britain has, in truth, always been global, and the globe has not always been grateful for it; but now the government preaches internationalism while erecting trade barriers and curbing migration. After empire, Britain found a new role in Europe, but with that now gone, Global Britain risks producing global isolation. Despite the foreign secretary's rhetoric, the Commonwealth, geopolitically and economically, has moved on from its imperial past. It is not waiting to be re-taken.

Jonathan Lis is the deputy director at British Influence.