The left's opposition to badger culls ignores the plight of our farmers

Rural workers' livelihoods are being devastated by TB. Labour should come to their defence.

"Dave" is not his real name. He’s too scared to tell me that. He’s been a farmer in Devon for over fifty years. He loves animals and knows everything about cows. He knows their moods, their temperaments, their individual identities. His family works fourteen hours a day seven days a week to serve and look after their dairy herd of 1,000, hand feeding them when they’re sick and nursing them through birth. It’s work of blood and sweat. He doesn’t shoot badgers, but since the government’s new trials started he’s been scared his family farm might be a target for animal rights activists.

"If I speak to you it will have to be anonymous because we’re terrified to speak up…." He says, "We’re attacked so easily right out here. It’s very isolated in the countryside and no dairy farmer can afford extra security right now."

This autumn a new controversy has split British politics. It’s the biggest rural-urban divide since fox hunting. To deal with the huge number of cattle being infected with TB, the government is piloting badger culls. Sites in the south west of the country will be allowed to shoot these cute little black and white creatures on the grounds that they are spreading this devastating infection that is killing cattle and crippling farmers. If the pilots are accepted and rolled out, some 100,000 badgers could be killed.

Parliament is set to debate the pilots on Thursday. To date, the argument has divided neatly along left and right lines. The new Tory environment secretary, Owen Paterson, says that it’s "sad sentimentality" to worry about badgers when so much damage is being done to the rural economy. On the other side, shadow environment minister for Labour, Mary Creagh, has called on the government to abandon the trial, dismissing it as a "shot in the dark". Brian May isn’t happy and the radical left is advocating the direct action that keeps farmers awake at night . As a self-declared lefty, I know where my team stands. But I disagree - I think our values might be better served supporting farmers.

My worry is this. The left has always been the party of cities and urban areas, growing as it did out of the trade union movement. It has never had enough to say to rural workers, as I’ve argued before. I’m worried that the countryside could be reduced to a play park for urbanites. I’m concerned that it will become a place to protect fauna and fauna, rather than to cultivate jobs and livelihoods. A place to visit at weekends, rather than strive through the weekdays. The Labour Party was supposed to be about labour – the clue is in the name – but we seem to be prioritising the concerns of people without a working connection to the land. How can Ed Miliband talk about being "one nation", when we have so little to offer these rural workers?

My friends say they are not against farmers, they just don’t believe there is any evidence that culling works. The evidence from the Kreb trial – the most thorough and widely quoted research - demonstrated that culling could result in a 16 per cent reduction in TB over nine years. It’s true that the methods used for the current pilots are slightly different – badgers are being shot outright, rather than caught in cages - and there was evidence that TB could be spread further unless hard boundaries are put in place. We can’t dismiss those concerns, but surely if the evidence is divided, the answer is more trials, not a complete lock down?

More research is urgent, because both sides agree that TB is devastating the countryside. We know that it has resulted in some 34,000 cattle being sent to the slaughter last year alone. That figure is worth reading again because it’s almost one death every fifteen minutes. We know that it has cost us as a country some £500 million over ten years. We know that something has to be done.

Farmers are paying for this pilot themselves because they say past experience shows that it works. When David started farming fifty years ago, he used to shoot badgers, and his farm suffered no TB. When EU regulations made badgers a protected species, he stopped culling out of respect for the law. Now there are badger sets everywhere and regular cases of TB are driving them under. This picture has been replicated at a national level. In 1998 less than 6,000 cows were culled for TB, now we’ve had 21,512 in the first half of this year alone.

"We don’t want to kill all badgers," says Dave, "It’s only when their numbers get out of control that they start causing infections. Because they have no natural predators, it’s up to us to keep the numbers down or they take over."

Working so closely with infected animals means that Dave’s son-in-law came down with TB himself. His family stood by as he lay in bed rapidly losing weight and coughing, but they still want to keep going.

"My family wish to carry on farming," says Dave, “My children have been to college and trained to do it. They love it and their children love it. It’s in your blood. There are very few other occupations open to you around here in your 40s."

Animal rights groups and charities say that the answer is vaccines and increased biosecurity. But there is no credible vaccine for cows, and the vaccine for badgers is extraordinarily difficult to implement. The NFU reports that you have to catch each badger in a cage, and then vaccinate them once every year for four years for it to be effective. As for biosecurity, the idea that farmers have enough money to invest in initiatives like full scale separate housing is naïve – and I’m not entirely sure that ending free range farming is desirable anyway.

It’s difficult to explain how difficult life in the countryside already is. Back in Devon, one of Dave’s neighbours has recently gone out of business. The price of milk paid to farmers has been slashed by 4p a litre this year, and supermarkets continue to sell milk at barely the cost of production. It’s been too damp to graze outside, so fodder supplies have been used up and the price of grain is biting. We’ve lost 40 per cent of our diary farms over the last ten years and TB is pushing more over the brink. And all the left is talking about, is the badgers.U

Update: After this article was published, I was contacted by Labour's environment team, who wanted to highlight the work they have been doing for rural communities. In particular, they recently pushed for a parliamentary debate about the government’s decision to abolish wage protection for 152,000 low-paid farm workers, something they say will take £240 million out of rural workers pockets over the next ten years. They say they have also supported dairy farmers' calls for more transparent contracts, and tabled amendments in the Lords calling for the Supermarket Ombudsman's powers to be strengthened. They say they have also highlighted how long-term youth unemployment has gone up faster in rural areas compared to cities in the first two years of this government. Finally, they wanted to point out that this BBC poll found that opposition to the badger cull was fairly similar in rural and urban communities.

Queen guitarist Brian May speaks with protestors as he joins a rally on College Green against the proposed badger cull. Photograph: Getty Images.

Rowenna Davis is Labour PPC for Southampton Itchen and a councillor for Peckham

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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?