Eddie Redmayne (right) as the young Stephen Hawking in “The Theory of Everything”.
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Stephen Hawking would not be Stephen Hawking if he had been born with his disability

The physicist is held up as an example of what you can achieve in life if you have a disability, but he was only diagnosed with motor neurone disease when he was 21 – his career was set in motion while he was still able-bodied.

Ask yourself this question: did you know that Stephen Hawking was only diagnosed with motor neurone disease at the age of 21? And if you’ve seen The Theory of Everything, can you honestly say you knew beforehand?

On the surface, pondering this may seem irrelevant. After all, the fact remains he is now disabled. But in honour of a man who has spent his whole life searching for the perfect equation, let’s respect for a moment that the order of things can hold vital importance, and lead to vastly differing conclusions.

This is certainly the case regarding perceptions of Stephen Hawking. The cosmologist was catapulted to worldwide fame following the publication of his book A Brief History of Time, yet it is sometimes easy to forget this sudden surge of recognition stemmed not only from his disability, but the small matter of theorising the nature of the universe.

I should know. Hawking’s career-defining book hit the shelves in 1988, and two years later I was born with cerebral palsy. By the time I had reached my formative years in primary school, society and those around me felt comfortable thrusting forward the image of Hawking, his wheelchair, and his genius as my source of inspiration. An anomaly blessed with extreme intelligence, the benchmark for what disabled people could achieve – transcending the tyranny of low expectation so readily shoved upon people in my position.

While this was no doubt well-meant – the widespread ignorance of the truth has twisted the man into something he is not. To be clear, Hawking gained his academic and scientific credentials whilst still very much able-bodied, even coxing one of Oxford’s rowing crews prior to transferring to Cambridge to complete his PhD thesis. Had he been disabled from birth, it is very doubtful he would have been given the same opportunity to establish himself.

Yet it is equally difficult to deny that Hawking’s work attracted such clamour precisely because his physical state and appearance juxtaposed the excellence of his work. Hawking’s doctor touched on the issue in his diagnosis. As the film’s dialogue puts it: “Your thoughts won't change, it's just no one will know what they are."

Of course, we now know speech synthesis has given Hawking new ways to continue to communicating, allowing the genius to shine through.  Even in today’s age of Google and Wikipedia, there is no other living scientist who is as instantly recognisable.

This battle of appearance over reality gets to the heart of the confusion over who Stephen Hawking is and how he ought to be explained. Long since anointed the founding forefather of “acceptable” disability, it is in fact his bright mind that gave him clout – way before he had motor neurone disease. By failing to recognise that Hawking’s success had nothing to do with disability, we give the disease undue credit for his perfectly able mind and outstanding scientific achievements.

This is even more problematic considering recent figures from the Office for Disability Issues, which found that four in five disabled people, like Hawking, are not born with their impairments. Despite this, they are still less likely to work full time, and similarly, less likely to be in high-level employment: 49 per cent as compared to 56 per cent of able-bodied people.  

And this is where the order of things becomes incredibly important. Hawking very nearly missed out on a First at Oxford, not due to lack of ability, but because of a failure to apply himself properly on questions and examinations he found too easy. The professors waived these indiscretions at his disciplinary undergraduate viva when they realised his potential.

Had Hawking been born with a disability, he would still have had this same potential – the same mind, daring, courage and thought, but he would have faced very different prejudices. It is likely that even the most basic access to advanced education would have been deemed out of the question, blocking the groundwork from which the mind-boggling theories emerged.

If in some parallel universe, I had the chance to go back in time and speak to my younger self and those thrusting Hawking’s wheelchair upon me, I would say this. Aspire to his levels of intelligence but do not judge yourself against them, and most of all, do not think it was his disability that made him great. He set in motion his achievements when he wasn’t disabled. While others may take you and your disability at face value, see yourself and your dreams as perfectly able. Stephen Hawking was still Stephen Hawking, wheelchair or otherwise. So are you.

Alex Taylor is on Twitter @ykts_net

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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?