Sunday 10 November 2019

The Tory Party's £1.2 Trillion Lie

In Tim Bale's history of the Conservatives, he makes the obvious point that to all intents and purposes the editorial offices of the right wing press are an arm of the party. And that was brought home this Sunday morning looking at the splash shared across the front pages of the Tory-supporting rags. All of them led with the news that the next Labour government is going to spend £1.2 trillion, which amounts to an extra £650m a day. The Tories have even set up an information gathering website to back the claim up. This has led to claim and counter-claim rocking back and forth across Sunday politics shows and social media, with the rather rash decision of Sajid Javid to challenge none other than the people's bank manager, John McDonnell, to a TV debate - a move Labour has jumped on with alacrity.

Since Labour emerged as a serious contender for government a century ago, making up stuff about Labour's spending plans is par the course. Readers with long memories will remember the 1992 general election in which the Tories accused Labour in a poster campaign of plotting a double whammy of more taxes and higher prices. So memorable in fact the Tories have put it on a tea towel. This time though the Tory attack runs the risk of overreaching. Yes, they wanted a figure out of the door that catches in the memory but £1.2tn just sounds like a ludicrous figure plucked from the sky. And when you look at the "evidence" the Tories have marshalled, this is exactly what they've done.

In the executive summary of the 36 page Tory document, they are brazen with the double dishonesty of their accounting. For one they tot up every spending commitment in the 2017 manifesto plus every commitment made by shadow ministers since, every policy passed by Labour conference, and every Labour policy paper. As anyone with a little bit of knowledge about Labour knows, conference votes on policy but there is no mechanism of forcing the leadership to accept it. Just ask Tony Blair about that. Instead, what goes into the manifesto is determined by the Clause V meeting, which variously draws on National Policy Forum documents, motions passed at conference, drafts of the manifesto, and policy papers. Lumping all this material together and totting up the price tag is the first wilful distortion the Tories accomplish. The second? They suppose every policy is going to be enacted on day one of the new parliament. They say it themselves: "All costings have been given for a five-year period, as this is the standard length of a Parliament." And so eye-catching items like the basic income trial or the four day week, which would take a while to implement - say two years into the 2019-24 parliament - are treated as if enacted from the off. To be sure, if Labour did the same trick on Tory spending commitments they would be the first crying to the press about the beastly lies told about them.

While it is useful for activists to know the nuts and bolts of this ludicrous Tory attack, as Grace Blakeley notes if you have to explain, you're losing. And so the best way of blunting the Tory lies is turning the problem back on its head - why does their spending only focus on electorally convenient items like policing and the NHS, and not the housing crisis, the crumbling infrastructure and public squalor of nine years of neglect, and flood defences in the Midlands and the North?

This brings us to the main point. Politics is about interests, and the Tories have been the traditional safeguard of bourgeois interests. And wherever there is an established, elite interest any old rope will do. We've seen it in the Labour Party as the right have crumbled, and we routinely see it from the Tories and their press helpers. It is not "conspiracy thinking" to suppose politics involves lying, as a recent silly book supposed, but a straightforward fact of political life. The Tories for their part are relying on lying about Labour because there is nothing else in the tank. How do they propose to fix the multiple problems plaguing the UK? How are they going to solve the productivity crisis, transition to a green economy, get mass property acquisition moving again, all the while in hock to the most damaging approach to Brexit designed expressly with the tax dodgers and low pay gluttons in mind? They can't, and they know they can't. And so they have to lie.

What effect will our £1.2tn lie have? Not a great deal, one would imagine. Where Labour seeks to inspire its voters, the Tories rely on fear to get theirs out. By demonising Corbyn and trotting out the old bankruptcy theme Johnson and friends are hoping the vote will firm up and give them extra reasons, apart from Brexit, to keep Labour out. And when your strategy relies not on persuading floating voters but turning out the already convinced, every body counts.

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Tasker Dunham said...

Even if true, it wasn't interpreted as suggesting that Labour would like to spend £43,000 to the benefit of each household.

Boffy said...

Even if Labour intended to borrow an additional £43,000 per household, put that into comparison with the increase in household debt and borrowing that has resulted from the adoption of conservative social-democratic policies since the time of Thatcher.

As a result of those policies, house prices in North Staffordshire rose from around £7,500 in the late 1970's, to around £150,000 for a comparable house today. Even allowing for inflation that is a massive increase. The average house price nationally today is around £300,000, meaning that if you can get a mortgage, you need to borrow around £270,000, as against maybe £12,500 in the late 1970's.

So, on that basis £43,000 seems quite modest to get all of he schools, hospitals, roads and so on we will need in the rest of this century.

But, also, the government can borrow today at around 1.7% for 30 years fixed. Given that inflation is around 2%, which is historically low, and certain to rise considerably above that over he next thirty years, you would have to be an idiot not to borrow, because you are being paid to do so by lenders.

On a simple interest basis (cos I can't be arsed to work out net present Values) £1 million over 30 years would rack up £17,000 of interest, but £1 million with just 2% inflation would have lost £20,000 in value over that period, which means that you would have gained £3,000 in real terms from borrowing.

Multiply that up into hundreds of billions, and calculate on compound rates, and the necessity to borrow and take advantage of these negative real interest rates is obvious. There is no shortage of people prepared to buy these bonds and much longer term ones should the government decide to issue them.

That is why the IMF, OECD etc. are saying that governments should borrow and use the funds to invest in infrastructure required to raise productivity.

Speedy said...

'What effect will our £1.2tn lie have? Not a great deal, one would imagine.'

More of the Cummings 'big lie' school, and about as effective as '350 million' I would say, which was highly, in fact almost certainly decisively.

You don't have to imagine, you just have to look at the history of political marketing - an interesting comparison here would be with the 'evil eyes' campaign of 97. Blair et al, spent years 'detoxifying' the Labour brand, on top of the years spent by Kinnock. After this process, the evil eyes had little purchase, in fact pointed to the weakness of the Tories argument precisely BECAUSE IT SEEMED THERE WAS NOTHING TO FEAR from Blair.

The same cannot be said for Corbyn, who the public have got to know (those who already didn't) over the past 2 years, and not in an especially good way if the beauty contest is to be believed. Couple this with pronouncements over nationalisation, etc., and the trillion is very believable among the voters Labour may seek to influence.

At this wretched point (with five weeks to go!) and the Brexit Party throwing in with the Tories it seems to me that the only thing that will stop a Tory landslide and the most rightwing gov ever, will be a MASSIVE volte face by Labour, stating a formal alliance with the lib dems and even standing down at unwinnable seats so the non Tory alliance can coalase and stop the juggernaut. Unthinkable?! Of course, and this is precisely why Boris is about to sweep everything before him.

It's absurd really, elsewhere where there are fairer electoral systems (Italy, France, Germany) the Left regularly teams up with opponents they despise in order to block something worse, but in the UK it seems the Left would rather draw down destruction on their own people than sacrifice their 'principles'.

If you were me you would have my views said...

"On a simple interest basis (cos I can't be arsed to work out net present Values)"

Its a ready made formula in Excel ffs!

"the Left regularly teams up with opponents they despise in order to block something worse"

Not true but lets say it was, they are in different parties right. I invite the Blairites to go away and form their own party and then maybe we can talk of a coalition.

Speedy is a curiosity, if you go way back and look at his posts, he came across as a straight down the road immigration obsessed, love to the police and army, I hate the left, I hate the middle class Blairites fascist and now he presents himself as Blairs best friend.

I guess the latest tactic of the far right, who utterly and totally despise Corbyn, is to try and present themselves as Blairites in order to undermine the socialist project in the Labour party, after all the far right hate nothing more than reds, well part from Muslims and speedy never hides his disdain for Muslims!

Speedy said...

WTF, I am flattered you care ;-)

While I flatter myself that I have the ability to evolve my opinions over time, personally I feel my position had generally remained relatively stable.

To help you understand:

- I never liked Blairites because I felt they did not represent the interests of most ordinary people and I criticised them on this basis. In particular, tuition fees and generally not being left enough.

I felt, and still believe, they could have been much more left wing and still won. I think I said John Smith's Labour were more my cup of tea and there you have it.

On the other hand, in terms of electability, I would prefer Blair/Brown over the Tories any day. If I have changed over time, it has been my appreciation of the importance of gradualism. I don't believe Blair was heading in the right direction however.

- the police/ army. Well, you have to have one, and they're an easy target. You would have to remind me what terrible thing I said...

- Muslims. How can anyone have anything against a block of people? There is good and bad in all. In principle Islam I don't like (any more than I like fundamentalist anything - and mainstream Islam is as intolerant in practice as many fundamentalist dogmas and as a SOCIALIST it behoves one to call that out), although the reformist minority deserves support, which it most certainly does not receive from the likes of Leftists who celebrate a woman's right to be oppressed 'if she chooses', a false choice of course, but false consciousness only appears to apply to 'white' people, which is inherently racist, as if 'brown' people were not to be held up to the same standards. Now if women and men 'choose' to subscribe to this faith, then as private individuals they have every right to do so, but that does not mean a state that promotes equality should tolerate the teaching of inequality in the education system, for example, or young girls being 'disappeared' abroad for marriage. And it should acknowledge that for every 'empowered' news presenter, there are many young women who feel trapped, and it should do everything it can to provide them with a way to fulfil their hopes and dreams, as much as it should all of the silenced voices in our society, and shouldn't use 'multiculturalism' as cover for inaction.

One day, when socialism has recovered from the virus of bourgeois Leftism that appears designed to obscure the true struggle for genuine, secular equality all this will seem obvious but I appreciate I am pissing in the wind, as much as one of those poor woman arrested for dancing without a veil on the streets of Tehran, but infinitely more fortunate.

If you were me you would have my views said...

“While I flatter myself that I have the ability to evolve my opinions over time”

I am not saying your views have evolved I am saying you are a fascist who simply pretends to want an ‘effective’ Labour party because of your utter disdain for socialists. It is a tactic I have seen before from fascists.

HouseofMalakian said...

I've literally just been reading old news articles on Doctor who. I'm a fan and was looking at timely women stuff and low and behold I see and advert about Corbyn and 1.2 trillion and led me to the following link

How much taxpayers money went into this ad?!?