Why isn't the government doing all it can to cut the deficit?

There's a whole class of policies which could cut the deficit in the medium to long term, which the government is ignoring. It's a sign of how weak public debate has become.

"Save Money, Improve Student Learning, and Boost The Economy By Paying Teachers to Quit Their Jobs", writes Slate's Matt Yglesias.

The rationale is simple. Teaching, particularly American teaching, is a profession where pay scales very strongly with experience. Thanks to strong unions and a relatively flat hierarchy, it's common for teachers to receive annual pay increases. As such, a teacher with 25 years experience will end up having a salary significantly higher than a teacher with five years experience.

That's fine if talent also scales with experience; but if it doesn't, it may be the case that it's cheaper to pay veteran teachers off, and hire younger ones. Yglesias writes:

Yet when Maria Fitzpatrick and Michael Lovenheim looked at an early retirement incentive program that Illinois implemented in the mid-1990s they did not find evidence of this adverse impact: "We find the program did not reduce test scores" they write "likely, it increased them, with positive effects most pronounced in lower-SES schools."

That finding probably isn't applicable to the British education system for a number of reasons: our pay agreements are different, our school structures are different, and frankly, the fact that American test results are the determining factor of success in the study does not inspire confidence. But Yglesias' suggestion of how that finding be used is generalisable. He argues:

The federal government could borrow a bunch of money at today's low interest rates and make it available to states and cities that want to pursue cost-saving early retirement incentive programs. The cash up front aspect of the ERI program would goose the economy in all the usual ways. But the long-term savings to state and city governments would improve the long-term fiscal outlook and thus boost "confidence" (or whatever). Kids would be no worse off in school. Districts would have to hire a bunch of new teachers, opening up some job opportunities for young people. And it's all voluntary—veteran teachers who'd rather stay on the job and get paid what they're owed can do so.

There's a gaping disconnect between the number of interventions which we know pretty well can save money in the long term, and the number we actually enact. Whether or not this particular one would work remains to be seen, but in general there are, at any one time, a huge number of things the state could do to lower its spending in the long term.

In the British context, a lot of them fall under the banner of "reversing the cuts"; the false economy by which funding for crucial services like legal aid or preventative healthcare was cut means that, while spending in the first years will be lower, in the long term they won't do anything for the deficit at all. (Or, even worse, a hard limit on all spending might result in the deficit genuinely being reduced, but at the cost of vast reductions in human welfare).

Of course, rhetoric mocking the concept of "borrowing more to borrow less" renders this entire category of valuable policies unsupportable, either by the Government, which would be accused of hypocrisy, or by the Opposition, which appears to have been stung too frequently by the barb to risk giving more ammo. So we're not likely to see deficit funded payoffs of veteran teachers any time soon, and so the government will continue to struggle to keep its borrowing low in the long term.

A teacher, teaching. 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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A progressive alliance in the Richmond by-election can scupper hard Brexit

Labour and the Greens should step aside. 

There are moments to seize and moments to let go. The Richmond by-election, triggered by Zac Goldsmith's decision to quit over a third runway at Heathrow, could be a famous turning point in the politics of our nation. Or it could be another forgettable romp home for a reactionary incumbent.

This isn’t a decision for the Tories and their conscientious objector, Goldsmith, who is pretending he isn’t the Tory candidate when he really is. Nor is it a decision for the only challenger in the seat – the Liberal Democrats.

No, the history making decision lies with Labour and the Greens. They can’t get anywhere near Zac. But they can stop him. All they need to do is get out of the way. 

If the Lib Dems get a clear run, they could defeat Zac. He is Theresa May's preferred candidate and she wants the third runway at Heathrow. He is the candidate who was strongly Leave when his voters where overwhelming Remain. And while the Tories might be hypocrites, they aren’t stupid – they won't stand an official candidate and split their vote. But will Labour and the Greens?

The case to stand is that it offers an opportunity to talk nationally and build locally. I get that – but sometimes there are bigger prizes at stake. Much bigger. This is the moment to halt "hard" Brexit in its tracks, reduce the Tories' already slim majority and reject a politician who ran a racially divisive campaign for London mayor. It’s also the moment to show the power of a progressive alliance. 

Some on the left feel that any deal that gives the Lib Dems a free run just means a Tory-lite candidate. It doesn’t. The Lib Dems under Tim Farron are not the Lib Dems under Nick Clegg. On most issues in the House of Commons, they vote with Labour.

And this isn’t about what shade of centrism you might want. It is about triggering a radical, democratic earthquake, that ensures the Tories can never win again on 24 per cent of the potential vote and that our country, its politics and institutions are democratised for good.

A progressive alliance that starts in Richmond could roll like thunder across the whole country. The foundation is the call for proportional representation. The left have to get this, or face irrelevance. We can’t fix Britain on a broken and undemocratic state. We cant impose a 21st century socialism through a left Labour vanguard or a right Labour bureaucracy. The society we want has to be built with the people – the vast majority of them. Anyway, the days of left-wing majority governments have come and gone. We live in the complexity of multi-party politics. We must adapt to it or die. 

If the Labour leadership insists on standing a candidate, then the claims to a new kind of politics turn to dust. Its just the same old politics – which isn’t working for anyone but the Tories. 

It is not against party rules to not stand a candidate – it is to promote a candidate from another party. So the way is clear. And while such an arrangement can't just be imposed on local parties, our national leaders, in all the progressive parties, have a duty to lead and be brave. Some in Labour, like Lisa Nandy, Clive Lewis and Jonathan Reynolds, are already being brave.

We can wake up the Friday after the Richmond Park by-election to Goldsmith's beaming smile. Or we can wake up smiling ourselves – knowing we did what it took to beat the Tories, and kickstart the democratic and political revolution this country so desperately needs.


Neal Lawson is chair of the pressure group Compass, which brings together progressives from all parties and none. His views on internal Labour matters are personal ones.