Every day the politicians of all sides bang the war drums and the media faithfully pumps out the message – debt is bad, debt is evil, debt threatens our future, debt must be eradicated, who is to blame for debt, debt hinders growth, debt has become the number one enemy of the British nation.
Back in 2011 David Cameron said the government was dealing with “a debt crisis… not a traditional cyclical recession where you just turn on the money taps”. The sound-bite of his 2013 speech to the 2013 faithful was “Lets deal with debt”.
Everyone in the coalition fans the flames of war against debt:
“The number one priority now is reducing the deficit that they [Labour] left us – the biggest deficit since the Second World War.” – Iain Duncan Smith
Nick Clegg boasted that his government is “wiping the slate clean of debt”.
“Everyone in our society has had to make a contribution towards dealing with the debts.” George Osborne
I could post enough of these kind of quotes to fill Wikipedia – but you get the picture.
Debt is the enemy – and the fearless coalition will wage merciless war on your behalf against debt.
Let us leave aside the age old debate that is stuck inside a Keynesian loop (or not as the case may be) – let us instead examine this war we keep hearing so much about because its an odd war indeed.
It seems pretty obvious that a war on debt would involve a decrease in government expenditure and an attempt to increase government income.
So one would imagine that the government’s big-ticket one-off expenditure projects would be cut or abandoned.
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Lets cut the nuclear replacement for Trident?
Government estimates of the cost of military projects don’t have a great track record but they often cost more in the final analysis than was estimated – usually a lot more.
For example, the cost of two new aircraft carriers that were meant to cost £3.65 billion pounds will now cost £6.2 billion
The MOD says it is “renegotiating the contract to avoid further significant rises. ” which seems like a good idea!
Cost estimates for replacing Trident vary from £20 billion (MOD) to £97 billion (Greenpeace) and it is bound to be a very big number over its 30 year life cycle.
Curiously though given the ferocity of the war on debt Trident is not to be abandoned.
Surely a hugely expensive weapon system of dubious necessity with open ended cost variables is an unnecessary luxury during a war on debt???
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Well… how about raising more via taxation?
Rich people have money and a recent report showed that Britain was the most unequal nation in the western world. So surely it makes sense to raise a few bob by raising the taxation on the wealthiest in British society since they have it better here than in any other rich nation.
Oddly though the reverse is true – the 50p tax band which taxes the wealthiest in society was abolished altogether losing the state up to £6 billion in lost revenue .
If we can’t tax the wealth of individuals….
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..how about rich companies paying the tax they owe?
In any war on debt, making sure you are at least paid what you are owed seems an obvious thing to focus on – but this is not happening terribly well – or at all – either.
In this article The Haze reported on stinging criticism from MP’s over the complete failure of HMRC in collecting more of the money it was owed – in fact it had contrived to collect LESS over the previous 12 months – leaving a gap of (wait for it) £35 Billion pounds that should have been collected but wasn’t…
…but that isn’t all – labyrinthine offshore tax avoidance schemes by some of the biggest companies in the world allow them to pay little or no corporation tax costing the UK an estimated £95 billion a year.
indeed far from getting after the big corporations during the war on debt George Osborne reduced Corporation Tax and reduced the staffing levels at HMRC – impairing their ability to collect what we are owed as a nation.
What a strange war on debt this is! We don’t cut huge military projects, we lower taxation for the wealthy, lower taxation for corporations and cut our ability to collect taxes (and unsurprisingly collect less).
If we cut Trident, re-instated the 50p tax band, collected the taxes we are legally owed by corporations and closed the legal loopholes that allow companies like Amazon, Starbucks and Vodafone to pay no corporation tax at all – there would be no need for the great war on debt – the recovered monies would wipe out Britain’s budget deficit.
But we aren’t doing any of these things – indeed not only are the wealthy paying less tax but the top 1% of our society have literally never had it so good.
The super-rich – the top 1% of earners – now pocket 10p in every pound of income paid in Britain, while the poorest half of the population take home only 18p of every pound between them, according to a report published this week by the Resolution Foundation thinktank, which reveals the widening gap between those at the very top and the rest of society.
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Who pays for the war on debt ?
George Osborne gave us the answer over and over again:
“Some politicians seem to think we can just wish away Britain’s debt problem. They want to take the cowardly way out, let the debt rise and rise and just dump the costs on to our children to pay off.”
This quote was from a speech about the government’s favourite topic – welfare reform.
David Cameron loves talking about this aspect of the war on debt:
We spend billions of pounds on welfare, yet millions are trapped on welfare. It’s not worth their while going into work.
Over 150,000 people have complained about Work Capability Assessments conducted by private french firm Atos Healthcare, who carry out ‘fit for work’ tests on sick and disabled benefit claimants on behalf of the Department for Work and Pensions (DWP).
Figures obtained by Sky News show that the advice charity Citizens Advice Bureau (CAB) have been inundated with complaints and desperate appeals for help from people who have failed assessments, many of which have serious long-term health conditions affecting their ability to work.
The CAB warn that severely sick and disabled people are being denied benefits as a result of a one size fits all ‘tick box’ medical assessment which is “unfit for purpose” and does not adequately take into account how people’s poor medical conditions limit their work capability.
The government has been accused of stigmatising disability – implicitly accusing disabled people of being malingerers – its hard to know just how much stress the new Work Capability Assessments have generated but this gives a clue:
Some doctors are now asking as much as £130 to provide medical evidence in support of their patients who have been denied benefits and whom have chosen to appeal the decision. Others are refusing to provide any assistance whatsoever as they claim they do not have the time because of being under “huge and increasing” pressure.
Changes to the Employment and Support Allowance appeals process mean that people who have had their benefits stopped or reduced must now request that the decision be first reviewed by a DWP decision maker before they can apply to appeal to a social security tribunal.
This initial process is known as ‘mandatory reconsideration’ and appellant’s will have no entitlement to sickness benefit during this time but must instead claim Jobseekers Allowance (or nothing), even if they feel they are not capable of working or looking for work. Critics claim that this is trapping vulnerable sick and disabled people into saying they are ‘fit for work’ when they may not be.
Newspapers have been awash with reports of benefit claimants who have sadly lost their lives after being found ‘fit for work’ by Atos and the DWP
Nearly half of all the assessments made by ATOS are overturned on appeal – a process which costs the taxpayer a cool £66 million a year in appeal costs alone.
If it seems harsh that poor disabled people bear the brunt of the suffering during the war on debt – then they are not alone, all manner of other poor people are suffering too.
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The unemployed are facing strife everywhere
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* DWP staff set mandatory targets to withdraw benefits from as any JSA claimants as possible – leaving many utterly destitute.
* 600,000 Job Seekers had benefits docked as a result
* Jobseekers to be forced to do six months of unpaid work or lose all benefits
Its a bleak time to lose your job during the great war on debt.
meanwhile all manner of support services used mostly by poorer people are being reduced or cut altogether.
Scroll through this enormous list of cuts to services that form part of the war on debt and you notice that the effects of them will disproportionally affect people on lower incomes.
and the poor had more bad news recently as the war on debt meant a bedroom tax for poor people as well – in fact the disabled are being called upon to make yet more sacrifices during the war on debt as almost two-thirds of households affected by the “bedroom tax” have a disability.
Here is an all typical ‘bedroom tax story’ – you can read four more in this article in The New Statesman.
According to the Government’s own impact assessment, almost two-thirds of the tenants affected will be from households that contain someone who has a disability. Already living on low incomes and seeing cuts to other benefits, they now face losing an average of £14 a week, and up to £80 a month.
Money is tight for Vicky. She’s had severe anxiety. Both of her parents and brother died by the time she was in her twenties. She has arthritis and sleep apnoea, leaving her unable to work. It means she has to live on £101 a week; a combination of income support and the low rate of Disability Living Allowance. With two spare bedrooms, she is set lose a quarter of her housing benefit.
“I’m worried sick about this bedroom tax,” Vicky tells me. “When the tax comes in, for me it’s going to be a choice between that and my gas and electric.”
She says she tried to tell the council she wouldn’t pay the tax. “They said as soon as I’m £50 in arrears then they will take me to court and [that] will lead to eviction.”
well we must make sacrifices during wartime – no doubt that £14 a week will make a big difference.
If you are wondering just how bad things have got for poor people during the great war on debt then the answer comes from some surprising sources.
The Red Cross is now distributing food parcels to the destitute in the UK – the first time they have felt the need since WWII.
A report written by the Conservative Kent County Council making the obvious link between the great war on debt (brand named Austerity) and homelessness and the rise of food bank dependency was hastily withdrawn but you can read it here all the same.
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Have you got it yet? the truth about the great war on debt?
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It is not a war against debt at all – it is a war against the poor.
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Anyone in poverty is a target – the working poor, the unemployed poor, poor people with disabilities, poor immigrants, sick people with little money and old people with no money. Every day the war on debt implicitly blames, stigmatises and punishes those without the money or power to defend themselves.
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Debt reduction is not the purpose of this war, what is?
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I found a very illuminating parallel while I was watching a great documentary called ‘The House I live In’ about another war – the great ‘war on drugs’ that has blazed fiercely in the USA since Ronald Reagan took the baton from Richard Nixon.
The ‘war on drugs’ has not succeeded in reducing the number of people taking drugs – but it has incarcerated ungodly numbers of one minority group within the US – black people. That’s right folks – the ‘war on drugs’ is in fact a war against the black community.
The failures of neoliberalism need to be blamed on someone – the US economy has lurched from one disaster to the next while poverty and inequality have soared over the duration of the ‘war on drugs’.
But rather than search for the real culprits like the investment banks, the financial elites and the ultra wealthy – attention has focused on the black community whose pesky tendency to organise themselves along the lines of the civil rights movement was clearly a threat to the restoration of wealthy class power in America.
The similarity with the UK couldn’t be clearer – thanks to the handy camouflage provided by the great British war on debt – bankers, rich people and neoliberal practices go unexamined – the real enemy we are told is those damn poor people and only by punishing them and keeping them cowed will we ever sort things out.
So just like the USA the UK has sought a powerless minority to blame for the failures of neoliberalism.
Just like the USA the target is a group that has in the past shown worrying signs of organising effectively to protect itself (uppity trade unions and the like)
and just like the USA all the media (mostly captured by neoliberal vested interest) has fallen for it – never once doing the maths and wondering why it is that only poor people are made to suffer during the war on debt.
In a recent speech David Cameron preached from a golden throne that austerity and the war on debt must now be a permanent condition of life in the UK.
Its not hard to see why.
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