Tuesday, 20 August 2013

The power of the skiver

The mainly macro blog is well worth a read I reckon what with it being erudite, insightful and awfy polite. But …………… its post on the cost of fiscal austerity i.e. spending cuts, just doesn’t work.

Personally, I agree with every point the blogger makes about the human cost of fiscal austerity, its hard not to. Actually, its easy to add in some more about how say in the current environment the more marginal members of the labour force face the double whammy of being disproportionately affected by unemployment AND benefit cuts. You could even start making a more pragmatic argument about how some of the human costs have obvious financial implications e.g. as unemployed people are more likely to be depressed, unemployment increases the NHS drugs bill.

But, the current political response to such human costs, which it's sad to say has popular support, is to simply dismiss it all as being the result of skivers whose personal failings are the actual cause of any costs, not impersonal political-economic forces. For instance, unemployment is associated with poorer health and diets? Well why aren’t the unemployed using their time to take walks and make soup then, eh? Increased incidence of depression? They should stop watching so much trash TV during the day then shouldn’t they and so on etc.,

So spelling out the human cost of fiscal austerity fails as an argument not because its wrong, but because politically  it’s framed as a moral, moralising argument to which the right already has an embedded response based on what it thinks is sound, common sense (the more generous pro-austerity lot might go so far as to say that's all very well, but that's why spending decisions are so "tough", except then they'd spoil it by saying something like "and what we need right now are leaders willing to make the tough decisions").

Instead of what are perceived to be appeals to the heart, to which the right will respond with what it thinks is its head (but is actually 3-4 feet south of that), I  reckon an alternative is to spell out the direct economic costs, which, given the mainly macro blog is by an economist, you’d expect to have been the case. Unemployment, especially long-term unemployment, which is now at record levels, destroys skills and employability, it leaves deep scars that undermine an economy’s medium to long term productive capacity and all that means in terms of potential growth and inflation. There.

Can I just be clear though, the moral argument against fiscal austerity and what are clearly avoidable high rates of unemployment is right, but we’re in this weird place where such “moralising” is dismissed in favour of what its proponents consider to be hard-nosed, common sense.

Yes, support for spending cuts is increasingly nothing more than a nasty, little "moral" tale of its own, but that's the way things are. Positively, this also means its possible, actually its easy, to make a "good, "sound", "common-sense" "economic" case against it i.e. to beat them at their own game.

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