There’s no reason to accept austerity. It can be defeated

Source: The Guardian Unlimited

It would hardly be surprising if the large majority of British people who didn’t vote for the Conservatives were daunted at the prospect of what’s now in store for us. David Cameron and George Osborne can hardly contain their enthusiasm for the torrent of cuts and privatisations they are about to unleash.

This is to be austerity on steroids. The full gory details of the £12bn benefit cuts the Tories refused to identify in the election will have to wait for next month’s “emergency” budget. But Osborne has already rushed through £4.5bn of new cuts and asset sales to get us all in the mood. And he and Cameron are counting on a punch-drunk Labour frontbench to smooth the imposition of a punitive fiscal regime. To wrongfoot the opposition still further, the chancellor now plans to enforce permanent budget surpluses in law. It is, as 77 leading economists warned, a dangerous political gimmick that could help trigger another 2008-style debt crisis.

But indefinite austerity, which transfers wealth from public to private and poor to rich, is Osborne’s aim. Under the coalition it brought economic recovery to a halt and had to be quietly shelved even to achieve the faltering growth of the past couple of years. But now they’re going to kick it all off again, just as the Greek crisis is engulfing the eurozone.

Powerful Tory figures and the OECD are warning Osborne to slow down his planned cuts – or risk stifling growth and hitting workers dependent on tax credits and housing benefit. But instead he’s plunging into a fire sale of government assets: £23bn worth of privatisations – from the huge public stakes in RBS, Lloyds, Royal Mail, the Royal Mint, Met Office and Channel 4.

Not only did the Tories fail to mention most of these privatisations – opposed by the public in repeated polling – before the election, but RBS alone is to be sold at a £13bn loss, throwing away the chance of a publicly owned bank that could help rebuild the economy. And their exchange of long-term revenues for short-term cash injections will do nothing to reduce the deficit.

Continue reading