Thursday, 28 October 2010

UK Welfare Spending in One Easy Graph

Time to scotch another Tory myth. Is UK welfare spending at historically high levels, acting like a deadweight around the neck of UK plc and dragging the economy into the gutter? The graph below showing welfare as a proportion of GDP (thanks to Duncan's Economic Blog) suggests not:


The more the Tories lie, the more they expose themselves.

10 comments:

Dan said...

I saw the data on the other blog but keep meaning to trace it back to it's source and check what their definition of "welfare" is. Instinctivly it feels wrong that we have not seen much of an increase in this recession, though the initial fall in 97 makes sense as one of the original ideas was a view of stop wasting money on unemployment and get people back into work.

CharlieMcMenamin said...

A pedant writes:

The source data is compiled here, drawn from Treasury figures. Welfare spending has of course risen in absolute terms: Duncan's graph show it as a %age of GDP. The definitions of expenditure are the govt's- so this chart excludes pensions, which most of us would consider part of welfare expenditure.

Boffy said...

And now they hyave Boris accusing them of Kosovo style "Social Cleansing" with their Welfare Cuts to Housing Benefit! That's on top of the complaints that Big Capital routed through Vince Cable complaining that the Immigration Cap meant they couldn't recruit the high level talent they needed. Now Big Capital in the City seems worried that there will be an exodus of all the thousands of unseen workers on low paid, low status jobs who keep the city running, and facing them with a labour shortage.

But, I wonder what ordinary Liberals feel like. They must be a bit travel sick. They started off posing as to the left of Labour, now they find themselves in the van with a bunch of Tories to the Right of Boris, and who found that the usual Right wing parties in Europe were not extreme enough for them, so joined up with a bunch of fascists and other crackpots. But, apparently even they are not right-wing enough for Tories like Carswell who is already branding the Tory leadership as traitors.

It doesn't seem a very sturdy ship to me.

Robert said...

It may not be a sturdy ship but I doubt the Liberals will jump overboard. They wouldn't want to bring on an early election while they remain unpopular, especially if their policies have helped create a recession. My guess is that the coalition will hold together for the whole five years. They're gambling that by 2015 the economy will have recovered and they can claim to have taken the tough decisions necessary to clean up after Labour. It may be bullshit but Daily Mail morons may buy it.

Anonymous said...

Boris for leader.....

Loz said...

Correct that the tory party is going so far right that it might fall off the edge, but I think we need to see Boris' opportunism for what it is.

With Livingstone already neck and neck with him in the opinion polls before cuts bite, and most angry former Lib Dem voters likely to come out in favour of Labour rather than the Tories, I think he can see the electoral writing on the wall when the cuts start to bite in London. Hence his "attack" on the Tory party to try to show his "independence" from the government. It worked for Ken, so Boris calculates it can work for him.

But if the the best this oafish fop can muster is a fairly offensive soundbite, I think most people will see through it.

Boffy said...

Loz,

I agree about Boris's Opportunism. Apparently, though, according to Tory insiders, he's got his eye on becoming Leader, and I'm not sure how this actually plays into that ambition, unless there are powerful forces looking for a champion. I was reading Paul Mason's blog, which was talking about the fact, that the IMF have come out in fairly clear terms undermining the Tories Economic arguments about the Cuts, leading to growth. Also, Martin Wolf the economics Editor of the FT has just written a piece titled "Why The UK Economy Has Gone Rock Climbing Without A Rope", which continues his fairly overt attacks on the Tory Cuts policy that he and Sam Brittan have been coming out with in recent weeks. That on top of the Wall Street Journal article slamming the Tories Child Benefit proposals, shows a head of steam building at least against what appears to be a considerable degree of amateurism and incompetence in the way the Tories have gone about their proposals. As I wrote the other day, a cycnical person might even think that some of the Permanent State bureaucrats that the tories want to put on the Dole, were being less than helpful when you look at how badly thought out some of these proposals are. Its as though Civil Servants were setting Ministers up for a fall. Who'd have thought that kind of thing happens?

Robert said...

Oh you're so cynical Boffy. It's not healthy you know.

Chris said...

While I agree that Tory policy appears unbelievably amateurism it is very convenient for Boffy that Tory Toffs Cameron and Osbourne are now the representatives of ‘right wing populism’ and that other toff Johnson is the representative of ‘big capital’.

No longer apparently do the Tories just talk populism to appeal to the backward sections of society, no longer do they talk tough on crime but then in office see crime explode, no longer do they talk about the work shy only to see unemployment soar when they are in office or talk anti European only to sign every EU treaty or talk tough on immigration only to do nothing about it. No those days are over, now the Tories mean it and have become the representatives of this 'populism' How very convenient. And this startling transformation in the Tory party has not come from some spiv who got lucky but from the very centre of establishment power, members of the Bullingdon club no less. Who would believe they would be responsible for this epic transformation!!

How very convenient!

Boffy said...

Robert,

The Liberals may be counting on things getting better, but by supporting the present course they are making that unlikely. The point is that the Cuts are not necessary. By spending several months talking up the idea of the economy being on the edge of a precipice, however, the Liberal-Tories have undermined confidence, and created the conditions under which even limited Cuts and retrenchment will have a bigger than necessary negative effect. Germany, for instance, could get away with a measured withdrawal of stimulus, because, its economy was growing strongly. The Uk econhomy was also growing quite well as a result of the stimulus, and the recovery of the global economy. The coalition's narrative undermined that. There is no doubt in my mind that global growth would have resulted in western economies dragging themselves out of recession had they only withdrew the stimulus gradually and having given time for the recovery to take hold. The Liberal-Tory policies as with those of other right-wing populists in Europe and the US are counter-productive to that process. If they are continued, they will create an uneccessary crisis, which will force western Capital to undergo a brutal restructuring that it has attempted to avoid for the last 35 years. That restructuring is necessary as part of a restructuring of global Capitalism, but the question is the pace by which it is done, and the conditions udner which it is done. I've been preparing a blog on htis for a couple of weeks or so.

Throughout the 1980's and 90's, western Capital went to great lengths in expanding Monetary policy in order to maintain markets to avoid a repeat of the 1930's, and the whole point of that was to create the conditions udner which that restructuring could be done at a pace, which suited it, and avoided the very significant costs of a major dislocation. It would be stupid to throw all of that away at the last minute, but that is what the right-wing populists are risking. The danger of that is shown by the Tea Party in the US, who are right-wing populists engaged in what is really a peasants revolt against modern capitalism. Given the echo of those sentiments in Europe with the anti-EU sentiments the danger for Big capital is obvious.