George Osborne’s economic policy is based on lies

The budget is the fiscal equivalent of sticking your fingers in your ears and shouting ‘LALALALA NOT LISTENING’.

On Wednesday the Chancellor announced his plan, hailed by many as a “steady as she goes budget”. I confess some confusion as to how this might be a good thing, when according to most indicators “she” is steadily going to hell. I am also bemused by the attention this man’s policy announcements have attracted. It seems to me that intense dissemination of how these policies might work in practice, is tantamount to a spirited and detailed conversation about the quality of the stitching on the Emperor’s New Clothes.

The assumption that this Government will implement anything it says, let alone implement it successfully, flies in the face of evidence. Infrastructure projects which will not be completed during this Parliament (and some which will not even have started), Enterprize Zones which are still being set up, two years after being announced, and have delivered 5 per cent of the jobs projected, a Business Bank which is only now setting out a schedule for its creation, a Funding for Lending scheme (a replacement for the grand Loan Guarantee Scheme, scrapped after four months) which has actually seen lending drop dramatically, a Back To Work programme which is actually worse at getting people into jobs than doing nothing, a Green Investment Bank whose only action so far has been to appoint an expensive private consultant, a Right to Buy home ownership scheme which has delivered 1.5 per cent of the sales envisaged, a Big Society Bank for a Big Society which Cameron launched four times, that shows no signs of getting going and, in fact, hopes to have appointed a Chair by 2014! I could go on.

Why should anybody be interested in any big announcements this government makes? They are just that: announcements. With the economy stagnating for three years now, they are the equivalent of what I do when I am supposed to go out, but having a “fat day”; I try on every single outfit, having already decided to stay in and sob quietly, while having a large pepperoni pizza.

The only thing of interest in a budget nowadays is the actual data of how the Chancellor has performed – not his promises of how much better he is about to. In that respect, the budget was fascinating. Many commentators have assessed thoroughly and forensically the failures of this Government on growth, stagnating wages, lending, future borrowing et al – the IFS’s review does so as well as any. I am more interested in the two items claimed by the government as successes; the two planks to which this drowning Chancellor is clinging: the borrowing rate and the employment figures.

On these, I offer two short sentences from the OBR’s budget report.

On the Chancellor’s attempt to show – “by hook or by crook” according to the IFS – that we borrowed less this year compared to last, para. 4.27 explains that “the Government has taken action to ensure that central government departments spend less in 2012-13” and this includes “a number of elements”. Here is one:  “payments that were due to be made late in the current financial year (for example payments to international institutions), but which are being delayed into 2013-14.”

Read that again. Take it in. In order to keep his head above water, the Chancellor has asked Government departments to delay payments which were due this financial year until after 1 April. These payments, of course, still have to be made. Just not right now. The direct fiscal equivalent of sticking your fingers in your ears and shouting “LALALALA NOT LISTENING”. And this man, with his Delboy approach to state finance, is the person entrusted with the long-term health of the country’s economy.

On the employment rate, many have expressed doubts about the claim repeated with almost drummerlike monotony that “one million new private sector jobs have been created”. We know, for instance, that there has been an astonishing surge of hundreds of thousands of people who show as “self-employed”. We know there have been strange transfers of public service jobs directly to the private sector, as support services are privatised in every department.

The OBR hints at these irregularities in their executive summary: “The labour market continues to surprise on the upside, despite the continued weakness of GDP growth.” As a former civil servant, I would be tempted to read that as “there is something really dodgy about these figures”. Then, at para. 3.108, which talks about “people employed in government supported training and employment programmes” comes the confirmation: “Of the total increase in employment in 2012, compared to 2011, around 14 per cent reflects increased participation in those programmes.”

People on unpaid internships, training schemes, apprenticeships and workfare schemes, are counted as employed. One hundred and forty thousand of them are part of the Government’s job creation success story.

I never understood Hollywood’s obsession with the Evil Genius as the film villain of choice. It has always been clear that, given a position of power, an Clueless Idiot has infinitely more potential to cause harm. What I find astonishing is that Conservative MPs, many of whom are honourable men and women and all of whom are obsessed with fiscal responsibility, have not yet grabbed this man by his expensively tailored lapels and thrown him in the Thames.

British Finance Minister George Osborne poses for pictures outside 11 Downing Street. Photograph: Getty Images

Greek-born, Alex Andreou has a background in law and economics. He runs the Sturdy Beggars Theatre Company and blogs here You can find him on twitter @sturdyalex

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Labour's establishment suspects a Momentum conspiracy - they're right

Bernie Sanders-style organisers are determined to rewire the party's machine.  

If you wanted to understand the basic dynamics of this year’s Labour leadership contest, Brighton and Hove District Labour Party is a good microcosm. On Saturday 9 July, a day before Angela Eagle was to announce her leadership bid, hundreds of members flooded into its AGM. Despite the room having a capacity of over 250, the meeting had to be held in three batches, with members forming an orderly queue. The result of the massive turnout was clear in political terms – pro-Corbyn candidates won every position on the local executive committee. 

Many in the room hailed the turnout and the result. But others claimed that some in the crowd had engaged in abuse and harassment.The national party decided that, rather than first investigate individuals, it would suspend Brighton and Hove. Add this to the national ban on local meetings and events during the leadership election, and it is easy to see why Labour seems to have an uneasy relationship with mass politics. To put it a less neutral way, the party machine is in a state of open warfare against Corbyn and his supporters.

Brighton and Hove illustrates how local activists have continued to organise – in an even more innovative and effective way than before. On Thursday 21 July, the week following the CLP’s suspension, the local Momentum group organised a mass meeting. More than 200 people showed up, with the mood defiant and pumped up.  Rather than listen to speeches, the room then became a road test for a new "campaign meetup", a more modestly titled version of the "barnstorms" used by the Bernie Sanders campaign. Activists broke up into small groups to discuss the strategy of the campaign and then even smaller groups to organise action on a very local level. By the end of the night, 20 phonebanking sessions had been planned at a branch level over the following week. 

In the past, organising inside the Labour Party was seen as a slightly cloak and dagger affair. When the Labour Party bureaucracy expelled leftwing activists in past decades, many on went further underground, organising in semi-secrecy. Now, Momentum is doing the exact opposite. 

The emphasis of the Corbyn campaign is on making its strategy, volunteer hubs and events listings as open and accessible as possible. Interactive maps will allow local activists to advertise hundreds of events, and then contact people in their area. When they gather to phonebank in they will be using a custom-built web app which will enable tens of thousands of callers to ring hundreds of thousands of numbers, from wherever they are.

As Momentum has learned to its cost, there is a trade-off between a campaign’s openness and its ability to stage manage events. But in the new politics of the Labour party, in which both the numbers of interested people and the capacity to connect with them directly are increasing exponentially, there is simply no contest. In order to win the next general election, Labour will have to master these tactics on a much bigger scale. The leadership election is the road test. 

Even many moderates seem to accept that the days of simply triangulating towards the centre and getting cozy with the Murdoch press are over. Labour needs to reach people and communities directly with an ambitious digital strategy and an army of self-organising activists. It is this kind of mass politics that delivered a "no" vote in Greece’s referendum on the terms of the Eurozone bailout last summer – defying pretty much the whole of the media, business and political establishment. 

The problem for Corbyn's challenger, Owen Smith, is that many of his backers have an open problem with this type of mass politics. Rather than investigate allegations of abuse, they have supported the suspension of CLPs. Rather than seeing the heightened emotions that come with mass mobilisations as side-effects which needs to be controlled, they have sought to joins unconnected acts of harassment, in order to smear Jeremy Corbyn. The MP Ben Bradshaw has even seemed to accuse Momentum of organising a conspiracy to physically attack Labour MPs.

The real conspiracy is much bigger than that. Hundreds of thousands of people are arriving, enthusiastic and determined, into the Labour party. These people, and their ability to convince the communities of which they are a part, threaten Britain’s political equilibrium, both the Conservatives and the Labour establishment. When the greatest hope for Labour becomes your greatest nightmare, you have good call to feel alarmed.