The people in power are beginning to panic. They conceal their eroding self-confidence by pretending that recovery of the economy is around the corner. But they continue to deceive with words that conceal their culpability, shifting guilt on to the people who played no part in the crushing of communities that is now proceeding apace around the world.
Economists are beginning to reconcile themselves with their contribution to the global depression. Rachel Lomax is one of them. She is a former deputy governor of the Bank of England, a senior mandarin in the UK Treasury during the Thatcher years, one of the architects of what’s called “Anglo-American neo-liberalism”. She now confesses that the model that was supposed to deliver sustained growth is caput.
But here’s the problem. People like Lomax are incapable of shifting the mindset to figure out why the economy has imploded. That means the appropriate remedies cannot be adopted. And so, she asks of others: “Where is the revolutionary thinking?”
The language now employed to discuss the economy and society was perverted precisely to prevent thinking “out of the box”. So we arrive at one terrible conclusion. The people who were supposedly trained to think about these issues have lost that capacity. So where do we go from here?
Business as Usual
Western governments are almost unanimous in believing that the way to re-balance the economy is to crush the living standards of people at the bottom of the pile. Their decisions are not driven by malice. They are operating on auto-pilot. The policies they invoke are calculated to preserve the system. So it’s business as usual, with no revolutionary intent whatsoever.
An example is the UK’s Chancellor of the Exchequer. George Osborne waxes lyrical about everybody sharing in the pain as taxes are raised on the rich and benefits on low-income people are reduced. He insists his policies are “fair”, and he attacks the tax-dodging multi-national corporations as immoral for hiding their money in tax havens.
Osborne is the classic case of the son of a father who earned his living, who then got snared by the rent-seeking culture. Osborne is a land speculator. His added bonus, as an MP, is in being able to require the taxpayer to cover the interest costs on the mortgages he took out to buy land. Two deals reveal the moral standing of this moraliser.
(1) He bought land in Cheshire and claimed up to £100,000 in expenses to cover mortgage interest payments on the property. He paid £455,000 for the property and sold it last year for up to £1m, pocketing a handsome capital gain. Money out of thin air, without adding one iota to the productive capacity of the UK economy.
(2) The Daily Telegraph revealed that Osborne used the Parliamentary expenses racket to fund a second property deal, which he only stopped when the newspaper exposed the way MPs were abusing their power. They were milking taxpayers to fund their money-making property deals.
Under Osborne’s tax-and-benefits austerity programme, all the increased taxes paid by the rich are clawed back, with added bonuses, through the increased value of their up-market properties. The increase in the value of those assets is entirely funded by the low-income taxpayer, and disproportionately so by those who live in rented accommodation.
With that kind of mindset occupying the seat of power in a nation’s finance ministry, what chance is there of “revolutionary thinking”? None. It’s up to the people to take a grip of their destiny if they don’t want to be dragged down by their leaders.