Thursday, 10 December 2009

Red Papers Editorial - Cuts: an easy alternative to systemic change

Over the coming days, we'll be posting the papers in the latest collection of LEAP Red Papers 'The Cuts', available to download and discuss in full.

Today we post the Editorial - Cuts: an easy alternative to systemic change

The label of choice for the current systemic turmoil has evolved from the 'credit crunch', 'global economic crisis' and 'recession' to 'public sector debt'. This is quite an achievement.

The finance sector that brought the global economy to its knees in 2008 and 2009 will be written out of the story in 2010 as a new consensus solidifies among the political elite, parroted by the mainstream media, that the real crisis is public sector debt.

Despite the fact that the private finance sector collapsed in a heap of fraud and lies, and was bailed out by the public sector, it is now the public sector that is routinely labelled ‘wasteful’, ‘bloated’, ‘feather-bedded’ and ‘out-of-control’.

While calls have been made for systemic changes in the global financial order and to the UK banking sector – even by Government ministers on occasion – the pre-existing regulatory structure remains largely unchanged.

The problem now is the public sector. By taking on all that debt created recklessly by the private sector, the public sector is now in trouble. Banks were ‘too big to fail’ yet no area of the public sector will emerge unscathed from the UK cross-party consensus.

The message is clear: banks (and all the bonuses, profligacy and speculation that go with them) are essential; healthcare, education, welfare, and pensions are all to be sacrificed on the altar and offered up to the Gods of neoliberal orthodoxy.

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