A still from Pride, the 2014 film about the Lesbians and Gays Support The Miners campaign.
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What today’s activists can learn from the Lesbians Against Pit Closures campaign

Their triumph came through recognising that although their own oppression was important, it didn’t mean they couldn’t recognise others’ struggles as well.

“I loved it. I had a very emotional response to it,” says Wendy, when I ask her about the Bafta-nominated film Pride. She’s a member of the group whose story it tells: Lesbians and Gays Support The Miners (LGSM), the London group of activists who banded together to support a Welsh mining community through the 1984 strike. From the time I’ve spent talking to its members, I gather that Wendy’s response is common. The film is close to their hearts, perhaps because the majority of events it depicts are true.

But there’s one aspect of the story it doesn’t do complete justice. It presents Lesbians Against Pit Closures (LAPC), the women-only campaign formed by some of LGSM, as little more than a punchline. “What part of this space is unsafe?” asks one incredulous character when his comrade says the lesbians need their own group. Neither Wendy or Leonie, the other LAPC activist I spoke to, are bitter about this. “In real life,” says Wendy, “when I told people about LAPC they often snorted with derision, so [the film] was accurate!”

But their role in the campaigning and activism which surrounded the miner’s strike needs recognition. As Leonie states, it “can provide a model for how effectively different people can organise as one, and how empowering it can be for women to organise on their own.” Women activists today face abuse and death threats simply for voicing our opinions: this story is one we need to hear.

LAPC came into being when a number of LGSM members decided they needed a women-only space. The society of the time dismissed their voices and casual misogyny was rampant. Even within the friendliness of LGSM they could feel talked over. Ray Goodspeed, an LGSM member, admits frankly: “The men in the meetings were generally like men in most meetings.” A space of their own was one way of getting past this.

There were practical reasons too. Some like Wendy found it difficult to be confident in as group as large as LGSM, where things could become “party-political”, while others just found it easier to organise alongside friends: Leonie got involved with LAPC partly because “they were often in the clubs, cafes and bars where I had spent time”. Their aim, whatever the reason for it, was simply to create an atmosphere where women were able to organise.

They had similar methods to LGSM: rattling buckets outside bars and clubs to raise money for the miners and putting on two women-only benefits. As one member explains in the LGSM-produced film All Out! Dancing in Dulais, they also tried to “involve other people in what we’re doing”, collecting in spots other than gay-friendly ones, and going outside supermarkets with their buckets.

Campaigning wasn’t always easy. Leonie says “outside the supermarkets we were often shouted at”, but the supportive atmosphere provided by a women-only space meant this could be dealt with and brushed off.“If you can laugh about it together, that takes some of the pain out of it,” says Wendy. “I learned to ignore people who treated LAPC with derision, which toughened me up.”

Support didn’t just come from other members. Although they organised separately, LAPC’s aim was anything but segregation: it was total solidarity with the miners. They attended pickets, and organised a day at a Kentish Town community centre for themselves and mining women, many of whom were experiencing the same battle to overcome a sexist society. LGSM too were still allies, as were people from other groups organising on their own terms - people of colour, disabled people, other women, gay men. “I met people from other groups who became life-long friends,” Wendy says. “Through them I gained strength and insight into their struggles.”

This is the key to understanding what the lesson is modern activists can learn from LAPC. It’s not simply their method of organising within a “safe space” which sets an example, although that proved a brilliant way of giving women the confidence to voice opinions and gain experience as activists. Their – and LGSM’s – triumph came through recognising that although their own oppression was important, there was no reason on earth which meant they couldn’t recognise others’ struggles alongside their own.

That mindset from groups like LAPC, LGSM and others, meant that despite the miners’ defeat, 1984 ended with new bonds forged. 1985 saw the National Union of Miners block vote at Labour conference to commit the party to gay rights legislation for the first time.

Solidarity may seem difficult to find now, with the left and indeed feminism splintering into various ways of hand-wringing, but the women are adamant about how important it is. When asked if she still supports causes other than her own, Leonie states proudly: “Solidarity with people outside of my own ‘groups’ is even more important than it was during the strike. If ever there was a time where people needed to stand up for fairness, it is now.”

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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?