We are not all in this together

Ministers will be largely untouched by the cuts they are introducing. Is this a cabinet guided by the national interest or vested interests?

By Mehdi Hasan Published 21 October 2010

"There will be some redundancies," George Osborne told MPs insouciantly as he delivered his Spending Review (SR) on 20 October and confirmed 490,000 job losses in the public sector over the next four years. The day before, just 3,000 people from across the UK arrived in Westminster to join a "rally and lobby" organised by the Trades Union Congress (TUC) against the Chancellor's spending cuts.

Meanwhile, across the Channel, French workers took to the streets for a seventh straight day of protests against their government's attempt to raise the retirement age by just two years, from 60 to 62. More than a million protesters have been disrupting schools, oil refineries and transport networks in France. "It's the street," Didier Caron, a striking Renault employee told reporters. "If the street works well, it could still win."

Despite media-induced memories of the Winter of Discontent, the British no longer do strikes, and certainly do not take to the streets in the same way as our confrères on the Continent. Or is that about to change? The phoney war is over. We are now a nation divided. The axe has fallen. The bloodletting has begun. Choose your own preferred metaphor or cliché, but the cuts to public spending announced in the SR are unprecedented in size, scope and speed. Council budgets slashed by 7 per cent every year for four years; 19 per cent off departmental budgets over four years.

Don't blame us!

“The deficit made us do it," squeal members of the Con-Dem coalition, from Prime Minister David Cameron downwards. Ministers have long pretended that these cuts are for the common good. And in his speech to his party's conference, Osborne claimed to be a One-Nation Conservative while dismissing his opponents as self-serving: "On the other side is Ed Miliband and the trade union leaders who put him where he is. The national interest or the vested interests."

Put to one side for a moment the long list of notable figures who have spoken out against Osborne-style austerity measures, from Barack Obama to a string of Nobel Prize-winning economists (including the latest laureate, Christopher Pissarides of the LSE) and focus instead on the curious phrase "the national interest". The idea that ministers are guided by the interests of the public at large, rather than those of the insular and privileged elite from whom they are drawn, is laughable. Coalition ministers – Tories and Liberal Democrats alike – have little experience of unemployment or life on benefits; in fact, of any economic hardship whatsoever. Twenty-two out of 29 cabinet ministers (76 per cent) are millionaires, 19 out of 29 (66 per cent) were educated at private, fee-paying schools and 19 out of 29 (66 per cent) are Oxbridge graduates.

Is this a cabinet guided by the national interest, or vested interests? Not since the days of Harold Macmillan in the late 1950s has Britain been governed by politicians representing such a narrow social base. And Supermac and his millionaire colleagues at least believed in the universal welfare state. Cameron and his rich chums, in contrast, are engaged in a war on welfare.

In June, the Work and Pensions Secretary, Iain Duncan Smith (net worth: £1m), used an interview with the Sunday Telegraph to urge jobless people to move in order to find work ("Coalition to tell unemployed to 'get on your bike' ", was the headline). In September, Osborne (£4.6m) castigated benefit claimants for making a "lifestyle choice". Earlier this month, the Culture Secretary, Jeremy Hunt (£4.5m), told poor families to have fewer children.

Are we really "all in this together"? The Department for Education, for example, has cancelled the building of 400 playgrounds. But how will that affect, say, the Cabinet Office minister Oliver Letwin (£1.6m), who has his own tennis court at his home in Somerset? The Department for Culture has scrapped free swimming for children and pensioners, describing it as a "luxury". Why should that concern the Transport Secretary, Philip Hammond (£7.5m), who has a swimming pool at his mansion in Surrey? The Department for Transport is relaxing the cap on rail fares, which is expected to lead to fare increases of 10 per cent a year for the next four years. But how will that bother the Chancellor, George Osborne (£4.6m), who once claimed £440 from the taxpayer for a chauffeur-driven car to take him from his Cheshire constituency to London?

Plutocracy extends far beyond the cabinet table. The Topshop boss Philip Green (£4.4bn), whose wife lives in the tax haven of Monaco, has been put in charge of cutting government "waste". The former BP chief executive Lord Browne (£45m) has been appointed as the lead non-executive on the Cabinet Office board. The banker Stephen Green (pension pot: £19.1m), outgoing chairman of HSBC, is to join the coalition as a trade minister in December. National interest, or vested interests?

Outsourced Britain

Meanwhile, the millionaire cutters in government have been able to call on the support of their multimillionaire friends in the corporate world. In the run-up to the Spending Review, the Daily Telegraph published a letter from 35 senior business leaders backing the Chancellor's spending cuts and assuring readers that they would "deliver a healthier and more stable economy".

One of the signatories was Ruby McGregor-Smith (salary: £1.1m), chief executive of the outsourcing company Mitie, whose annual report for 2010 notes: "The public sector faces the prospect of considerable pressure on expenditure in the coming years. We believe that this will create significant opportunities for the outsourcing market as contracts will tend to become larger and broader in scope . . . we believe that in subsequent years we will benefit from the efficiency agenda that is expected to impact central and local government." National interest, or vested interests?

To point out that cabinet ministers will be largely untouched by the cuts that they are introducing, or that austerity measures could enrich their private-sector pals, is neither "class war" nor the "politics of envy". The financial crash transformed public attitudes towards the privileged and the wealthy, the undeserving rich. I suspect voters will not stomach a diet of cuts, cuts, cuts imposed by millionaire ministers and backed by corporate barons and bonus-rich bankers. Even if Britain is not France. Yet.

Special Offer: Get 12 issues of New Statesman magazine for just £12

78 comments

Fri, 2010-10-22 02:34 — PhilDuval

Is anybody interested in addressing the fact that Britain is the only developed world economy to be taking this approach?

Are the right wingers prepared to acknowledge that Price Waterhouse Coopers have said that this will cost a million jobs? That the Financial Times, of all papers, has been the most critical?

Why is becoming a private vs public sector argument? EVERYONE stands to lose. I've worked in both sectors - they depend on each other. I worked in Corporate Procurement for my city council and we bent over backwards to help local businesses.

The private sector has done VERY well out of PFI and suppliers to schools, hospitals and councils will be hit as hard as the public sector workers.

Thu, 2010-10-21 14:07 — Julie (not verified)

Just been referred here by post from HYS on BBC. Won't bother reading New Statesmen again if this is the socialist drivel they print. How about the economic credentials of all our politicians, particularly the last useless lot who have done such damage to our finances.

Thu, 2010-10-21 14:08 — Mike Thomas (not verified)

Spiller,

First, welfare, £17bn has been cut, including not paying child benefit (a £2.5bn saving) to any family with an earner paid over £44,000 putting them into the top 10% of earners. Which Labour opposed.

Next, real terms increases, schools budgets are to get a real terms increase albeit small and the NHS is as well so all departments were not cut.

As for who bears the largest brunt, that would be the top 20% not the lowest 20%. Combining the measures in the Budget and CSR, the IFS have declared that the budget is progressive.

As for other ramblings, they are incoherent.

Lastly, how is government spending, the bankers fault, did they put a gun to Brown's head when he ramped up government spending by 5% every year from 2001?

I'd keep your fingers in your ears if I was you, it's clearly stopping the rest of your grey matter leaking out.

Fri, 2010-10-22 02:56 — Daniele1

Well said Medhi! Brilliant article! You have summed up the situation.
But why oh why aren't the British people in the street like the French?? why do they take such injustices with such pathetic resignation? It is depressing to hear people saying they are "concerned", "worried", "scared" about the cuts, when interviewed. Why aren't they ANGRY for Christ's sake?
Here they tell you that the French are on the streets because of the rising of the pension age from 60 to 62. What you do not hear on the news is why that makes them so angry. It is not because they are lazy and don't want to work another 2 years. It is because there is high unemployment among the young already and the longer older people work, fewer and fewer jobs will be available for the young, one argument that I have not heard once here when they talk about raising pension age.
They are also in the streets because of similar cuts to the ones inflicted here BUT they are not prepared to accept them, like the Greeks a few months ago.
Such difference in attitude is striking. I think it is partly due to the Thatcher years when the working class was emasculated and the Unions destroyed. It is also due to the popular press here which is almost entirely right wing and saying the same thing, spreading reactionary myths about the unemployed, immigrants etc..Now we are served a continuous stream of propaganda that those cuts are inevitable and all the fault of the previous government bla bla..If you keep reading the same lies everywhere , well you are bound to believe them.The French press is much more polarised and reflects different political views.
Also the difference between the French and the British mentality in those situation (I know both nations equally well) is that the French consider themselves "citizens" and the State is their affair and is there to serve them. if they don't like what the government does, they will protest, violently if need be.
The British seem to have a different rapport with their state. first it is a Monarchy, therefore they often behave as "subjects", not "citizens" in the sense that they are much more submissive to authority than the French, and they are easily persuaded that their masters know best. Furthermore most British people hate confrontation and prefer compromise and/or individual solutions. I have often noticed some people desperately unhappy with their work, preferring to just resign rather than bring the Union in and confront their employer.
France has also a strong tradition of class solidarity, something quite alien here.
I know of a couple of French pensioners who have been making their own placards and marching on the street of their town all week last week, for miles, sometimes in pouring rain. They are not poor, they are already retired, their children have a job and are settled. So why are they on the street? "For the others" they will tell you. "For the future, for the young people who can't find a job"and especially "because of the injustices, the rich getting filthy rich and the poor getting poorer". They have a sense of political duty , a social conscience and they feel they have to protest even though they are not directly affected. I see very little of that in Britain.Pensioners interviewed on the telly yesterday had a big smile on their faces, saying they were relieved that they could keep their bus passes and their heating allowance.it was pretty clear they didn't give a monkey about the people who were going to be affected by the cuts.
Thatcher has won "there is no such thing as society" she said.It seems to be true in Britain when you witness the lack of solidarity and the pathetic reaction to what this government did yesterday.
Maybe people will revolt when they realise that they are personally affected. If there are enough of them, which there will be.But as long as the majority of people remains more or less unaffected, no one will lift a finger to defend the poor or the sick and so few people seem outraged by the greediness of the rich ("politics of envy" they cry!) I hope I am wrong and some protests will develop in the next few weeks. I don't hold my breath.
This country is not becoming "little Britain", more like "little America" where people in need are just "losers" and everyone only thinks of themselves.

Fri, 2010-10-22 03:13 — Daniele1

What about the students?? why aren't they protesting? the proposed fees are ludicrous. University education is virtually free in France. If the government tried to introduce fees at all, never mind £8000, I believe they would have a revolution on their hands. it is plainly unthinkable. Everybody would be on the streets, not just the students, the whole population. Because Education is the key to social equality and paying for it would be totally unacceptable to all parties. Education is also seen , not as an individual advantage like here, but something society needs as a whole so no one objects to paying for other people's education as they recognise they need doctors, scientists etc..
it is shocking that the students here do not seem to react to the level of fees proposed. Is it because the present students won't have to pay that kind of money and they don't care about the students coming behind them? Yes I am afraid that's why.

Thu, 2010-10-21 14:20 — Spiller (not verified)

Ahh, Mike, Actually IFS has just said at the CSR briefing that it is in fact REGRESSIVE (Take a look) other economists have said the only messures that make it anywhere near fair are the ones that were already in place under Alistair Darling... Your info from the Mail is wrong.
My grey matter or your inabiltiy to type any sense or truth what so ever???
@Julie.. New statesman is a left wing publication you may want to try the Spectator.

Thu, 2010-10-21 14:33 — Deborah (not verified)

Real term increases to schools? Sure, if you exclude the 60% cut in capital grants; or the fact that the pupil premium is taken from other parts of the education budget.

Mon, 2010-10-25 09:59 — writeon1

Obviously, in a country like Britain where there are enormous, massive, grotesque differences in income distribution, wealth, and power over one's life... we are not, never have been, and unfortunately, never will be all in this together. That kind of society, where we were, all in it together, whatever that kind of marketing spin really means, would be something radically different from present day Britain.

If... if we were all in it together the tax system would have to be structurally overhauled, so everyone paid their fair share. Today we don't. I pay less tax than the women who cleans for us, though I do slip her extra under the table which she pockets and pays no tax on at all.

I don't really understand why comfortable people moan about the tax system, when it favours us so disproportionally and unfairly. Why can't we be more honest and truthful, instead of pretending that we are being over-taxed, when we most certainly are not; not at least compared to the poor, who pay vastly more than we do.

Thu, 2010-10-21 14:35 — Col. (not verified)

Putting aside the class war rhetoric and party political bickering in some of these comments, surely the point that Mehdi is making is that these cabinet ministers do not understand the difficulties of life in the bottom 20% because they are so far removed from it.
They still seem to believe that the majority of people on benefits are workshy scroungers, while those who are working on low incomes just need to work harder and get a better job.
Those of us who have lived, or still live on low to moderate incomes, and who have been, or know people who live on benefits, know differently.
The vast majority of people on benefits want to work, the fact is that they cannot afford to. There are very, very few jobs which do not require qualifications and / or experience, and which pay enough to support a couple in their home, let alone a family.
The instability of employment scares people who would like to have a go, but are afraid that they will work for a year, get made redundant and have to start the long and complex process of claiming benefits all over again.
The cuts to housing benefit, reductions in JSA, income support and incapacity benefit, the addition of another half million people ( at least ) to the dole queue and the end of secure council tenancies are not going to encourage anyone to take a chance on work, on the contrary, they will just increase the climate of fear that many people live in today.