Thursday, June 24, 2010

A weak and nasty government

The coalition government pitched its budget as a "progressive" one, ensuring that the burden of the austerity would be borne by the rich more than the poor. They even produced statistics to buttress this claim. If it was progressive, the rich weren't complaining. Bankers and businessmen applauded, while trade unionists expressed horror. No one believed the government's claim, the IFS cast serious doubt on it, and the FT has now produced its own statistical analysis, suggesting that the truth is exactly the reverse of what Osborne and Cable have claimed. It has been noted that the way in which cuts have been introduced, not as part of an express ideological commitment but in feigned sorrow and regret and with an attempt to package it as a progressive agenda, reflects the government's weakness. In fact, it expresses the weakness of the ruling class more generally, which does not have a coherent doctrine, an agreed solution, or even a faction with a determined agenda that is capable of asserting hegemony in their class and winning a measure of public support. In that respect, comparisons to the savage 1981 budget are misplaced.

However, the government does have a strategy, which involves terrorising and cajoling people. They have talked up the need for cuts, quite relentlessly, once in office. They have tried to create a panic about the state of the public finances, simulating a Greek-style shock, though in fact the fiscal situation is better than it was thought it would be. They have used the budget to not merely cut, but threaten severe attacks on all non-ringfenced public spending, slashing an average of a quarter of the budget across departments. But their real target is, and always has been, welfare. They hope that by scaring people about what they will do to education, transport, justice, etc., they will gain support if they suddenly decide to shift more of the burden to welfare.

And on the subject of welfare, quelle surprise, they are coming back for more. To begin with, promises enshrined in the coalition agreement that supposedly protected the poorest, such as the pledge not to attack bus travel subsidies and winter fuel payments for pensioners, are about to be tossed overboard. The welfare system is experiencing a phased attack, each additional blow intended to gain acquiescence and soften people up for more. The FT approves, editorialising in favour of more welfare cuts, and cuts in public sector pay, to avoid cuts in other areas such as justice and transport. The Economist agrees, bemoaning the fact that no party could publicly call for attacks on welfare during the election, but insisting that welfare must bear more of the burden. This is the ruling class in full battle cry - bail out the banks, pay off the bond traders, keep the basic infrastructure working, and make the poorest bear the cost.

At the moment, polls show that the government's strategy is working, and that most people acquiesce in the cuts agenda. I would say 'support', rather than acquiesce, but this would imply that the agenda was being approved rather than met with terrorised compliance. The polls also suggest that the strategy would have been less successful had the Liberal Democrats not formed part of the Tory government. In fact, support for the budget is almost identical to the level of combined support for the two governing parties. Give them their due - the civil service played a blinder by negotiating this lash-up government.

However, looked at from their perspective, the ruling class - whether they be in the Institute of Directors or in the highest levels of the state bureaucracy - must know how fragile this situation is. They have never taken polls as holy writ, but as materials to work with, sometimes to validate their policies as democratic, sometimes to plan strategy, sometimes to bludgeon their opponents with. They know how fragile any poll based 'consensus' is. They know that there is a real risk that this budget could produce the feared 'double dip' recession, and that even if it doesn't, public opinion could resile at the first sign of strikes and social unrest. They are also aware that their grasp on opinion has so far depended on allowing people to think that they personally might be spared the worst of the austerity, that the burden will be shifted to someone else. The actual experience of being clobbered, after a year or so of being protected by stimulus expenditure, is liable to shift opinion in dramatic and unexpected ways. And while support for the budget is fragile, opposition to it is extremely motivated. At the moment, socialists have between a quarter and a third of the public to work with, most of it probably concentrated in the public sector and in the unionised working class. That's the most important constituency, the one strategically best placed to resist, and we can build from that.