Tag Archives: austerity

More than 57,550 deaths may be linked to austerity

By Michael Berwick-Gooding and Katharine Pindar | Thu 28th October 2021 - 12:25 pm

It wasn’t only Covid that killed people before their time. In just the four years after the Coalition between our party and the Conservatives was formed in 2010, the spending squeeze may have caused 57,550 more deaths in England than would have been expected.

Research from the Centre for Health Economics at York University reached this conclusion after studying the cuts in Government expenditure between 2010 and 2015. The research has been reported in the online journal BMJ Open.

The research revealed that real spending on social care and public health rose between 2001-02 and 2009-10, but fell between 2010-11 and 2014-15. This total spending gap attributable to austerity of 15.08% is said to have been likely to have caused 23,662 additional deaths. Meantime real spending on health care rose less between 2010-11 and 2014-15 compared with between 2001-02 and 2009-10 creating a 13.64% spending gap.

The researchers reckoned that a 1% decrease in health care spend would generate 2484 additional deaths, so the loss of 13.64% between 2010/11 and 2014/15 might have caused 33,888 additional deaths. They also figured that a 1% decrease in social care and public health spend would generate 1569 extra deaths. So the ‘loss’ of 15.08% between 2010-11 and 2014-15 might have caused 23,662 additional deaths. Adding these together they calculate a total of 55,550 additional deaths. It is pointed out that their “calculations assume that all health benefits occur contemporaneously with spend, which is unlikely to be the case”.

It also needs to be noted that “primary care and specialised commissioning spending were not included in the measure of overall healthcare spend, because responsibility for these returned to central government in 2013, while data on local spend for these services is not available.” It is likely that the cuts to primary care and specialised commissioning spending and to benefits over the same period would have caused some extra deaths, but the report does not quantify them.

Some of us recognised at the time that austerity was the wrong policy, but now those Liberal Democrats who were in the Coalition government need to recognise the effect their supporting austerity had on the British people.

Does the party need to take action to ensure we never do this again? What can the party do?

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Fraser Coppin

Now is not the time for a return to austerity

By Fraser Coppin | Tue 24th November 2020 - 8:33 am

This week it looks likely that the Chancellor will announce a freeze on public sector pay and cuts to the foreign aid budget. There are also murmurings of more harsh spending cuts and tax rises on the way. If Sunak and the Tories are planning on a return to austerity then this would be a huge mistake, and the Liberal Democrats should oppose it.

There is no urgent need to cut spending or raise taxes right now. Borrowing is currently extremely cheap, and bond yields are likely going to remain low for a while. Even in the event that interest rates do start to rise, we can take the opportunity while costs are low now to borrow over a longer period of time, in fact we’re already borrowing over longer terms than any other OECD country so it’ll be a while before we have to start paying most of this debt back.

In these conditions policy makers can afford to be less constrained than they were in the past. There has never been a better time for some new ideas, and to build back better.

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Paul Reynolds

Covid-19: We are long past the point where we should give the UK government the benefit of the doubt

By Paul Reynolds | Tue 12th May 2020 - 3:00 pm


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Political conclusions drawn so far from the horrific tragedy of COVID-1,9 and the lamentable UK response, have often been hurriedly deployed in support of a range of political viewpoints.

Perhaps the most common is that the regrettable UK response has been due to the NHS being starved of funds due to ‘austerity’. Per person NHS budgets have been squeezed over a long period, and this almost certainly contributed to the NHS’s problems, and more money is needed, but it cannot be the whole story; or even perhaps the main story.

The UK spends the same or more on health, and a larger proportion on state health, than many other OECD countries, including Finland, South Korea, New Zealand and Australia.

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Katharine Pindar

Philip Alston and Transformational Change

By Katharine Pindar | Thu 7th May 2020 - 6:47 pm

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Eighteen months ago Philip Alston, the UN Special Rapporteur on extreme poverty and human rights, visited Britain for a fortnight, and travelled round all four countries to meet officials and ordinary people and community organisations. After also studying all the documents that had been published on the state of poverty here, he issued a Statement. This document still makes very sad reading. It shows up serious societal problems which the political absorption on Brexit last year and on the health crisis this year have distracted from, and which a progressive party such as ours must surely address.

He wrote in his Introduction:

It seems patently unjust and contrary to British values that so many people are living in poverty. This is obvious to anyone who opens their eyes to see the immense growth in foodbanks… the people sleeping rough in the streets, the growth in homelessness, the sense of deep despair that leads even the Government to appoint a Minister for suicide prevention and civil society to report in depth an unheard of level of loneliness and isolation. And local authorities, especially in England, which perform vital roles in providing a real social safety net have been gutted by a series of government policies.

Describing people he had talked to dependent on foodbanks and charities, some homeless and sleeping on friends’ couches, young people who feel gangs are their only way out of destitution, and people with disabilities told to go back to work against their doctors’ orders, he also remarks on “tremendous resilience, strength and generosity” shown by neighbours, councils and charities in support.

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Blaise Baquiche

A longer read for the lockdown: Why I left the Tories and became a Lib Dem

By Blaise Baquiche | Tue 28th April 2020 - 2:10 pm


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It wasn’t Brexit that made me leave, but a stark realisation that there was something deeply wrong with the Tory party.

I owe my life in Britain to a Tory MP. In 1957, newly elected Keith Joseph was instrumental in persuading the government to grant sanctuary to Jews fleeing Egypt following the Suez crisis, which included my father aged 8.

My grandfather, a 32-year-old dentist at the time, was asked by Egyptian authorities why he was leaving the country. Predicting a surge in hostility towards non-Arabs inspired by President Nasser’s populist speeches, he responded “because you’re allowing me to”.

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Nick Rider

The best way to answer Coalition guilt-shaming is to challenge austerity and poverty today, head-on

By Nick Rider | Wed 7th August 2019 - 1:30 pm

The election of a new Liberal Democrat leader has been followed by a predictable burst of accusations and guilt-shaming – mostly, but not only, from Labour sources – regarding the Lib Dems’ part in the Coalition, cuts and austerity. Responses on Liberal Democrat Voice and in other Lib Dem groups have often followed a familiar pattern too. A fair amount of irritated defensiveness. A lot of detailed discussion of the financial situation in 2010, deficit levels, etc. Sometimes a feel of this being a rather theoretical economic argument a bit far away, only raised to torment us.

I think this is to miss the point. The best way to get over endless guilt-shaming and raking-over of the Coalition is not to get sucked into circular arguments over just what part any Lib Dem minister played in this or that decision in 2014 but to say very clearly we’ve moved on, there are urgent matters to be dealt with, and that today, in the here and now, 2019, the Liberal Democrats see poverty as a real crisis, care about it and are prepared to tackle it.

What doesn’t leap out from current Lib Dem responses is any sense of urgency. An urgent awareness that there is an atrocious crisis of poverty in this country, and it’s getting worse. Galloping homelessness, thousands dependent on food banks, more and more people in work but so poorly paid and so insecure they barely keep going. Public health indicators that had been improving for decades now stalled or going backwards, as the United Nations’ Alston Report on Poverty in the UK highlighted.

And behind this worsening poverty are some very old ideas, like the assumption that anyone in need of support is potentially a ‘scrounger’ culpable for their own poverty who needs to be kept in check through such things as the benefit sanctions regime.

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Paul Hindley

We Lib Dems need to oppose austerity

By Paul Hindley | Fri 26th July 2019 - 11:55 am

The Liberal Democrats are the party of David Lloyd George, John Maynard Keynes and William Beveridge. We are the party that laid the foundations of the welfare state and pioneered support for Keynesian economics, which strived to create an economy of public investment in infrastructure, growth and full employment. Our party’s history is one which is staunchly against ‘slash and burn’ austerity.

Of course, during the Coalition Government, the party’s leadership supported the austerity programme of David Cameron and George Osborne. This continues to be used against us by supporters of other progressive parties, not least Labour, despite the fact that Labour also supported austerity. I hope no-one joined the Liberal Democrats to introduce the ‘bedroom tax’, support the benefits cap, cut legal aid, cut housing benefit to young people, introduce assessments for disability benefits or to support benefit sanctions. It is not a nice thought, but whether you think Coalition austerity was right or not, it has ruined people’s lives and led to thousands of preventable deaths.

Coalition austerity was not compatible with the liberalism of Lloyd George, Keynes or Beveridge and many Lib Dems opposed austerity during the Coalition Government. Since the Coalition, the party has clearly begun to move away from austerity. This began in 2015, when the Liberal Democrats opposed the Conservatives’ Welfare Bill, while Labour abstained. In the general election of 2017, our party was committed to reversing more welfare cuts than even Jeremy Corbyn’s Labour Party. 

At our Autumn Conference last year, the ‘Demand Better’ policy motion committed the party to ‘a better society, in which everyone is supported in times of need, with an end to austerity’. Those three words, ‘end to austerity’, are absolutely essential if we are to win over more Remain voters, most of which vote for progressive parties. They are as important as the other two words for which our party is known for, ‘Stop Brexit’. Indeed, austerity has helped to fuel the rise of Brexit populism and therefore if we want to stop Brexit, we must end austerity.

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Coalition? Who cares?

By Alex Wasyliw | Thu 25th July 2019 - 12:45 pm

coalSo the Lib Dem leader election is over and predictably Labour have gone full on coalition grievance mongering in response. They’d have done this whoever won, no doubt somewhere in Labour HQ there is an unused “This is what Ed doesn’t want you to know” video.

It seems to have fallen a bit flat, which is a good sign that people are reacting less viscerally but that doesn’t mean all is fine, it just means people are prepared to think about it.

People are listening to us again. 

The coalition and austerity will come up and we need to be able to address it. To be fair, we owe it to the public and ourselves to address it.

It’s unarguable that austerity happened whilst we were in coalition. Cuts were made and these cuts made people’s lives harder. It’s legitimate to care about that, irrespective of the reasons behind our decisions.

Every time I’ve heard Lib Dems address this I feel we still haven’t found a way of talking about it that recognises this legitimacy and can start rebuilding bridges.

When someone raises austerity we react as if they are asking us why we supported the policies of austerity. We talk about the economic climate, we talk about the lack of options, we talk about the fact we were in coalition and had to compromise, or maybe about how every party intended to make cuts.

Sometimes we make these points well, sometimes not so well but the real problem is we are addressing it from the wrong perspective. 

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Kirsten Johnson

ICYMI: Lord Roberts demands more for those made homeless

By Kirsten Johnson | Wed 8th May 2019 - 5:27 pm

It was a busy week last week, with local elections and all, but in the midst of the flurry of leaflet delivery and canvassing, Lord Roberts was busy in Parliament questioning the Government on homelessness.

This has been a big issue in North Devon, as it is across the country, with austerity having gone too far and people not able to afford a roof over their heads.

Lord Robert posited:

To ask Her Majesty’s Government what assessment they have made of the decrease in local authority spending since 2009 on homelessness and the number of deaths of homeless people.

You can read the entire debate here and watch the video here.

Lord Robert’s office kindly sent over a piece on Rough Sleeping written by his researcher Shany Mizrai. We missed out on publishing it last week, but I think it deserves a read:

The House of Commons Committee of Public Accounts has described the extent of homelessness across England as a ‘national crisis’. Appallingly, at any one time, there are as many as 9,100 people sleeping rough on the streets. In 2017 alone, 597 people died while homeless – a third of them, of treatable illnesses. Unfortunately, facts now suggest that homelessness in England has risen 165% higher than it was in 2010.

Importantly, the National Audit Office highlights that there is a high prevalence of mental illness, alcohol and drug dependency among rough sleepers: of the 70% of rough sleepers who had a support-needs assessment recorded, 47% had mental health support needs, 44% had alcohol support needs and 35% had drug support needs. The question is: what is the government doing to help rough sleepers deal with these dependencies?

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Steve Trevethan

On Policies, Perceptions and Potentials

By Steve Trevethan | Wed 8th May 2019 - 12:30 pm

In theory, theory and practice are the same. In practice, they are not. (Anon.)

“Lack of social mobility” and “austerity” confront us. Perhaps much of what we might, and might not do, depends upon information, perceptions and attitudes?

In 2019 our public spending is about 38% of GDP, with the USA at about 36%, Germany at 42%, France 56% and Italy 36%.

In 2010 our national debt to GDP ratio was 53%. In 2018 it was 87%. Equivalent 2017 figures are: France – 98.5%; Germany – 64.1%; Japan – 222.3%; USA – 103.8%.

Since 2010, more than £30 billion has been cut from welfare payments, housing subsidies and social services. About 66% of “poor” children are in families with at least one parent working. Between 2012 and 2019, the number of children fed from food banks has more than tripled. Since 2010 homelessness has increased by 169%. The slowdown ln UK life expectancy is one of the highest in the G20 countries.

The above data, our own experience of people begging and living on our streets, and reliable reports that needed, skilled workers (such as nurses) use foodbanks, indicate that “austerity” has done great social harm.

Ten years on, the “deficit” is far from being removed, £billions of welfare budget cuts are planned and “austerity” has resulted in the slowest UK economic recovery in a century.

Perhaps we now need to campaign for its cessation and, if possible, its rectification? (The Institute for Fiscal Studies estimates that “rectification” needs expenditure of at least £12.4 bn above current budgetary projections.)

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Steve Trevethan

On austerity: Some questions and comments

By Steve Trevethan | Fri 29th March 2019 - 10:25 am

“The person who proves me wrong is my friend”.

Austerity seems to involve a set of theories and practices whereby the financial and economic matters which resulted in the “crisis” of 2008 are addressed. This seems to involve reducing governmental expenditure on infrastructures so that such expenditure matches or approaches the taxation income. Any difference between infrastructure expenditure and tax revenue seems to be met by governmental borrowing. This facet of Economics seems to be based upon the premises and assumptions of current Economics theory and practice.

The precipitating factors in the crisis are to be found in the USA with its housing boom and the growth in Collateralised Debt obligations and Credit Default Swaps . The three biggest rating agencies gave erroneously optimistic assessments and lots of them. Some financial corporations went bankrupt, some were taken over by the government and some were bailed out. The global financial system became paralysed. Layoffs and foreclosures continued with unemployment rising to 10%. During this financial bubble, the financiers frittered money on the high life and when it burst the personal fortunes of the financial bosses remained intact.

We were affected by this because of our close connections with the USA and our similar circumstances of inappropriate financial regulation, banks being excessively concerned with prioritising profit and income above national economic welfare, weak corporate media analysis, and general public ignorance of economics made worse by the “misinformation spread by the economics profession”. We too have had a “leverage bubble that drove asset prices skyward whilst starving British industry of development capital. We do also have an excessive Private Debt to GDP ratio which is a foundation of the crisis – 70% in 1939: c.160%  in 2017. 

 Alas, Austerity has a net negative effect on the economy and underperformed in deficit reduction. In 2010 it was stated that the deficit would be eliminated by 2015. In 2017/18 the deficit was £40.7 billion, wages had the biggest collapse on record and the mega-rich have doubled their wealth. Might this affect the demand for support infrastructures and reduce tax returns?

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Stephen Richmond

If we want to win elections we have to denounce austerity

By Stephen Richmond | Thu 7th March 2019 - 12:19 pm

Part 1

“Never point out your own mistakes” seems like a good political maxim, so why should we ignore it on this occasion?

Of course, not everyone agrees that austerity was a mistake at all, and some say we should embrace our coalition record. That would be a monumental mistake. Trying to embrace austerity would be like Labour trying to embrace the Iraq war, it would be untenable.

Many people point out that all the major political parties were pushing austerity at the time: during the coalition Labour boasted that the government had, more or less, kept austerity to the levels Labour suggested. Clearly this wasn’t something the Liberal Democrats were solely responsible for. That doesn’t mean it wasn’t a mistake though or that no one knew it was a mistake at the time. While it’s true that many economists working for large banks were very clear that government debt was definitely the problem (and noticeably not the banks themselves!) academic economists took a rather different tack- their warnings were clear and broadly, as it turned out, correct. Even the IMF famously chided the coalition for being too reckless with austerity.

Estimates of GDP per household lost due to austerity in the UK vary with from some at £4000 per household and the Oxford economist Simon Wren-Lewis’ guess being more like £10,000 per household. There is no suggestion it did anything positive. (Simon Wren-Lewis’ book ‘The Lies We Were Told’ chronicles this beautifully. Also worth seeing is the recent report from the NEF featured in Bloomberg estimating the cost at £100 billion.) The famous academic paper (by Reinhart and Rogoff) that was used as political cover for austerity in 2010 turned out to be based on a simple maths error and was ultimately disgraced. Traditional macroeconomics won out- if interest rates go to zero, which they did, governments must either increase spending or hold back their own economies- we chose to hold back our economy.

It’s estimated that around 50,000 UK citizens died unnecessarily due to austerity during the coalition with more afterwards. Which is why it sticks in the throat a little when we’re told, and I’ve heard this a few times from more coalition supporting Lib Dems, that the coalition was “the best government since 1945!” I would gently point out that that the post-1945 era includes the Attlee government, which took on the ideas of Keynes and Beverage, both Liberal party members.

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Tahir Maher

Theresa May – Austerity is Over

By Tahir Maher | Wed 24th October 2018 - 12:30 pm

Austerity wasn’t because of economic necessity but a political choice. The economic argument was that if you save your money/reduce your spend, you can clear your debt otherwise we were told we would end up like Greece. This view was accepted by Osborne resulting in this long period of austerity. It should be noted that in 2012 a report by IMF said that austerity had been a mistake. A better approach would have been to reflate the economy which would have left it in a better place to pay off the deficit. The report also said that the UK couldn’t end up like Greece because the debt was in its currency. The UK could raise loans through UK bonds (the problem with Greece is that they are in the Eurozone and share their currency with a number of countries, but there isn’t a euro bond. Each of the Eurozone countries still uses their own market to raise loans from bonds. External institutions who want to buy eurozone currency bonds are attracted to countries like Germany (although the interest rates are very low) while Greece has to significantly increase their interest rates to attract investors to buy their bonds, although it’s for the same currency.  The consequence of this is that Greece has youth unemployment near 50 per cent and Germany has youth unemployment close to 3 per cent because the bonds have to be serviced and interest paid on them).

This has been the most prolonged period of austerity post-war. The UK’s deficit peaked at 10% of GDP and Osborne in 2010 unveiled cuts of  £110 billions of fiscal cuts – public service cuts and tax increases (VAT). It wasn’t wholly a success as growth stagnated and unemployment rose. The Bank of England couldn’t reduce interest rates any further to stimulate the economy. Austerity measures did what austerity does, it contracted the economy, and this was the choice accepted by Osborne.

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Tahir Maher

Austerity and Napoleon

By Tahir Maher | Mon 12th February 2018 - 2:21 pm

There is an old joke: Income tax was introduced (by Pitt the Younger) to pay for the Napoleonic wars and now that those wars are over, surely it must be time to get rid of Income tax.

As a Liberal I believe in the individual and to build a society that will support and nurture that individual’s potential. If you look at examples in history, in almost every case it’s the individual who has made a difference so it makes sense to support creative/driven individuals to enable them to realise their vision.

However, society is made up of groups and communities with individuals of different capabilities. The predicament is to have a tax system that not only encourages investment and reward but one that ensures society is also equally served.

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Mary Reid

LibLink: David Laws – UK reaches socially acceptable limits of austerity

By Mary Reid | Mon 6th March 2017 - 7:39 pm

David Laws has written an article in the Financial Times, but you have to be a subscriber to read it.  We will give you a flavour of the piece here so you can decide whether to subscribe (the trial version is £1 for 4 weeks).

In May 2010, as the chief secretary in the UK’s coalition government, I warned that the choices available to us in Britain’s biggest postwar spending squeeze lay between the unpalatable and the disastrous, and that we were moving from an age of plenty to an age of austerity.

It has not been a bad prediction, by political standards.

At that time, public sector austerity was both necessary and deliverable. Necessary, because our budget deficit was an eye-watering £163bn, in excess of 10 per cent of gross domestic product. Deliverable, because the UK had only just ended an unprecedented expansion of public spending under the Blair and Brown governments.

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Steve Trevethan

Is austerity working? And do all debts have to be paid?

By Steve Trevethan | Mon 5th September 2016 - 9:32 am

 

These questions invite binary “Yes” or “No” responses. More considered approaches exist. We need to consider the economic consequences of debt repayment, structural and attitudinal causes and contributions, responsibility for debts both particular and general, beneficiaries and losers, and, how they may be prevented in the future. Also, can such enormous debts be paid?

This requires analysis and accurate, accessible language. In Economics and Finance, that which has different labels is sometimes not significantly different and that which is under one label has significant differences. For example, money consists mainly of credit creation since loans create deposits and loans are debts.

Debt is a form of relationship: financial activity connects and affects people.

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Peter Martin

Austerity economics, Brexit and the Government’s deficit from a Keynesian perspective. What are the choices?

By Peter Martin | Sat 13th August 2016 - 3:57 pm

 

Brexit or no Brexit, we have to improve and stimulate our flagging economy. We cannot blame Brexit for everything. We haven’t even started to leave the EU yet. Nothing has really changed. If there are problems we need to look at the effects of past years of austerity economics first.

The usual charge made against those of us who are of a more Keynesian inclination and who argue against austerity economics is that we are far too ready to let the Government’s deficit increase. In other words, that our policies will involve too much public borrowing, which will only add to high levels of public debt.

This is not necessarily true. But, we do need to understand what the government’s deficit is, how it originates, and why it was so difficult for George Osborne to make good his election pledges of reducing it, let alone turning it into a surplus. We can perhaps expect Philip Hammond to have the same problem. Tories seem very slow learners at times.

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Paul Walter

George Osborne’s decisions are coming back to haunt him

By Paul Walter | Sat 27th February 2016 - 11:23 am

Commenting on George Osborne’s planned spending cuts, Liberal Democrat Treasury Spokesperson Susan Kramer has said:

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Nick T

Was Vince Cable proved right on austerity?

By Nick T | Thu 18th February 2016 - 8:42 am

When the histories of the coalition government come to be written, those chapters focussing on the role of Vince Cable will be some of the most fascinating. Vince’s fierce intelligence combined with a (perhaps deliberate) flair for the enigmatic meant he was involved in some of the most interesting of the coalition’s key moments.

One area of particular significance is likely to be the analysis of his views on austerity. Throughout the coalition Vince was often portrayed in the media — and by some Liberal Democrats — as a brave warrior fighting an axe-wielding Tory-Lib-Dem cabal of ideological austerians. Yet this seems to me to be precisely wrong.

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Stephen Tall

Ed Miliband’s speech: 5 thoughts on what it means for Labour, Tories, Lib Dems and the 2015 election

By Stephen Tall | Wed 25th September 2013 - 3:45 pm

Ed MilibandI listened to, rather than watched, Ed Miliband’s speech to the Labour party conference yesterday. On the up-side that meant I missed the three hammy mid-speech standing ovations (shades of IDS c.2003); on the down-side it accentuated the peculiar whooping of some of the more excitable delegates (calm down, it’s just a politician talking). In its own terms — getting noticed for its content rather than simply as an impressive no-notes memory feat — it was an undoubted success. Matthew Parris in The Times rather brilliantly captures the flavour:

Crikey

…

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Nick T

Blair misses the point on the pre-crisis deficit

By Nick T | Thu 11th April 2013 - 2:34 pm

Tony BlairWriting in this month’s centenary issue of the New Statesman, former prime minister Tony Blair writes:

Labour should be very robust in knocking down the notion that it “created” the crisis. In 2007/2008 the cyclically adjusted current Budget balance was under 1 per cent of GDP. Public debt was significantly below 1997. Over the whole 13 years, the debt-to-GDP ratio was better than the Conservative record from 1979-97. Of course there is a case for saying a tightening around 2005 would have been more prudent. But the effect of this

…

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Geoff Crocker

Opinion: Why austerity is the wrong answer to debt

By Geoff Crocker | Tue 11th September 2012 - 4:28 pm

Austerity policy continues to be embraced by the UK coalition government as well as by governments across the world. This is causing predictable political unrest with large demonstrations and riots in Spain and Greece. The pain to UK households is substantial and set to increase. This is clearly socially undesirable, but more importantly is based on a technically incorrect analysis of the current economic crisis.

It is fashionable and great sport to blame bankers for the crisis, to say that the developed world has ‘lived beyond its means’ and that we ‘cannot afford’ economic growth and therefore must cut our economic output …

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David Thorpe

Opinion: Liberal Democrats must not apologise for cuts

By David Thorpe | Fri 13th July 2012 - 8:54 am

Occasionally Nick Clegg, or his speechwriters create a phrase which deserves to live on in the political lexicon long after the rest of the speech has been confined to the political dustbin. The pre-2010 General Election debates were transformed by Nick referring to the “two old parties” and asking voters to “do something different this time”.

While the phrases were memorable, they were hardly that effective. Voters did what they did the last time they faced a Labour government mired in staggering incompetence and a Tory party leadership tacking to the centre while the grassroots howled. That was in the 1970’s when voters gave Labour a kicking and the Tories the mandate of largest party in parliament but no overall majority. In 2010 the outcome was the same with Labour weakened and the Tories becoming the largest party, except that on this occasion, the Liberal Democrats, from MPs to ordinary members, voted by a huge majority for a coalition. But while the phrases used in the debates were clever and eye catching, it was another of Nick’s phrases which should help set the tone for the party in the future. Nick said there would be “savage cuts”, while Vince Cable joined his Tory and Labour colleagues in saying that post-election there would, under a Liberal Democrat government, be “cuts faster and deeper than Thatcher”.

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David Thorpe

Opinion: You can’t have ‘growth’ without ‘austerity’

By David Thorpe | Mon 28th May 2012 - 12:54 pm

Amid the current maelstrom of gossip, speculation and forecasting concerning the British economy, a number of myths have developed.

Principal among them is that the coalition’s economic plans for this parliament contained ‘only’ cuts, with no concern for achieving growth.

The issue of whether fiscal consolidation itself can be a driver of growth is one I aim to address further below, but first I want to debunk that myth.

The economic plans, outlined by the coalition in 2010, made clear that the first half of the parliament would contain the bulk of the …

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Bill le Breton

Opinion: Austerity and defying the Laws of gravity

By Bill le Breton | Wed 9th May 2012 - 10:58 am

“It’s ideology, stupid.” – a subtext to the Queen’s Speech

On Five Live a bond trader says that austerity isn’t working and the government should be more expansionary. In Wake Up to Money a fund manger says that austerity has been overdone and it’s time for countries like Germany and Britain to borrow more.

Yet on Tuesday’s Today programme, David Laws continued to advocate austerity.

It is more and more apparent that ‘economics’ is being used to serve the ideology of a smaller State, damning the idea that the State should have different responsibilities at different times, especially when the private sector is …

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