The MEDIA impact of George Osborne’s autumn economic statement on 5 December was lost as it coincided with the death of Nelson Mandela. But workers ought to reflect: the statement is a declaration of intent by the ruling class about how it seeks to strengthen its hold over our lives.
The banking crisis that started in 2007 and 2008 launched a depression not forecast by the experts who now predict recovery. Osborne and others used the opportunity, introducing “austerity” economics – actually, impoverishment for workers everywhere.
The persistent symptoms of a falling economy are evident to all: shops vacant; jobs hard to come by especially for the young; underinvestment in major industry like energy; smaller business unable to secure bank finance; benefit cuts; a new housing bubble – and wages low and falling against inflation. Yet Osborne claims recovery is in prospect.
This year has seen a modest drop in registered unemployment from 7.9 to 7.6 per cent. GDP will rise by an estimated 2.4 per cent. But workers’ wages continue to fall, as the Treasury knows. And the number of millionaires rises daily.
Growth projections depend on continued consumer demand, business investment and exports. Demand may be up slightly as people use savings but that won’t carry on in the face of further decline in real wages and benefits.
Announcements about business investment were window dressing: the government is selling off what’s left of public assets, and cutting scientific research. Banks are unwilling to lend even when financed by the state. Exports have stayed level even though the pound has devalued – and there’s little evidence they will increase.
Ministers parrot the lie that public spending “crowds out” private investment, denying the reality: the lending bubble and banking crash. The theology for the so-called recovery is that reducing employers’ overheads – wages and taxes – will create jobs.
For our class to believe in those lies is to accept that there in no need to fight for wages and control of the economy. Wealth, real value, is created by workers, not by ministers or banks. ■