Public spending:why are they insulting our intelligence?

12 06 2009

I do not usually subscribe to the Jeremy Paxman thesis on politicians and truth telling, drawn from the ‘why are these effing lying bastards effing lying to me’ school. However, listening to politicians talking about the future of public spending I fear he has a point. The ‘debate’ over whether Labour or the Conservatives will cut public spending in the future has already been reduced to a level of mendacity I struggle to recall in any previous encounter of this sort. (Although David Miliband’s absurd claim that the nationalisation of Lloyds Bank was an ‘act of political radicalism’ shows that lying is now second nature).

Let us first of all rehearse the reality of the position of the public finances. As Martin Wolf has pointed out, by next year 53% of the economy will be accounted for by the public sector, but only 38% of the economy will go to taxes, leaving a gap of 15%, or roughly 180 billion in one year which will have to be raised either by extra taxation or extra borrowing, were public spending to remain on its current trajectory. Now, we have got used to dealing in billions and so the shock of this huge figure may not be what it used to be but this is still a lot of cash.

Maybe the political parties believe that tax revenues will recover to plug the gap, maybe they believe they will find eager lenders who will be happy to lend indefinitely on a vague promise that things will get better. Maybe they really do believe those things and so their protestations that there will not have to be big cuts in public spending are from the bottom of their hearts.

The problem with this is that no economists or financial commentators believe either of those things. There is a vast concensus, backed up by facts and figures, that public spending will have to be cut. Scour the financial press if you do not believe me. It is in fact a mere fantasy that the main parties want us to believe in.

So why are the politicians lying so brazenly? I think the easy answer is to assume this is what all parties do in the run up to elections. But the scale of the lying is such that we have to assume things are much worse than that. The real reason they are lying so brazenly is that they are simply afraid to tell the truth. They are now so weak and isolated they cannot imagine delivering a tough message, let alone a tough programme. This is the outcome of the continual erosion of political authority over the past twenty years.

Whatever we may feel about the rights or wrongs of public spending cuts, or which areas we want to see protected, at least we should be granted an opportunity to debate the whole issue openly and honestly. The lies of the politicians are merely an insult to our intelligence and an abnegation of democracy.

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