Thursday, October 28, 2010

today : blame Canada

Now the Tories are in, and doing the same old things, there is a temptation to will the economy to tank, to wish them to screw up so I can not only see them tipped out of power again, but to enjoy it. A bit like the extra relish you get from a four nil victory, that's not just a victory, but leads to the opposition manager being sacked.

But I also know plenty of people who are teetering financially, and if Osborne's gamble fails, will take a pretty nasty hit. Because to will failure on Tory policy is to will people out of work and to will people into living on the streets. So I really want everything to be okay.

Except it won't be. I talked before about the intellectual basis of Osborne's cuts and I am reminded of Thatcher. She, of course, had many qualities. I cannot but admire the way she went back to work the day after the IRA tried, and almost succeeded, in blowing her up. It takes a strong and wilful person to carry on in such a situation. Likewise her willingness to be disliked and apparently not care. But, of course, she was wrong on almost all policy issues, morally suspect in consorting with likes of Pinochet and heartless in face of the suffering of her own people. The same qualities that I could admire, unfortunately sprang not from a Churchillian resolve and vision, but from being blinkered and, frankly, a bit thick.

She, of course, was seduced by the Monetarist vision poured into her ear by Keith Joseph (shamefully, he was my MP). And I am always extremely suspect of anyone who proffers an evangelistic position on anything. There is certainty of vision, and then there is a kind of swivel-eyed adherence to ideology that appears to ignore doubt. I have never known an intelligent person who didn't question or moderate their opinions by reflection and engaging in a dialectical process with alternative viewpoints. I have, conversely, known many, many very stupid people who are absolutely certain of their own correctness.

Osborne and his people seem to have been seduced by what happened in Canada in the 1990s. A massive deficit reduction programme, with a goal of balancing the books within a few short years not only got Canada out of a financial hole, but counter-intuitively, the economy grew at the same time.

As with all situations, Canada's economy at the time was subject to very specific conditions. To extrapolate a template from what happened is risky at best and folly at worst. But isn't this what all ideologues do? They constantly try to find a magic solution, a simple set of rules that solves or explains everything. Always, it ends in tears. Whether it's Stalin bolting his own notions onto Marx and coming up with the Soviet nightmare, or a free market, light-touch regulation of financial institutions leading to a collapse of the banking system.

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