GFTU BGCM Minutes 2017

something like the old Keynesian system whereby a rising tide lifted all boats,

that there would be a more progressive economic policy and it just did not

happen. Two things have happened since 2008/09, and I think this is the real

reason for Brexit. One was that the right in this country were much, much

quicker at seizing the opportunities than the left. The left had spent so long, I

think, under Blair and to a lesser extent under Brown, buying into the neoliberal

system that when the crisis came in 2008 there was no real intellectual

underpinning for a left wing alternative. In the 70s the new right had been

waiting for that moment for a long time. They had been beavering away for

20/25 years, putting forward, in my view, their crackpot remedies, but they we

ready with a policy platform for what to do when the crisis came. When the

crisis came in 2008/09 the left was really like a rabbit in the headlights and did

not actually know what to do, apart from try and get the genie back in the bottle

and get back to business as usual straight away and that left the field open to

the right to come along and say that the real problem here was that

governments had overborrowed, that if the private sector, if companies were

tightening their belts, if consumers were tightening their belts then the answer

had to be for governments to also tighten their belts and this is where we got

the idea that austerity should be the answer to the crisis.

Austerity was completely the wrong answer to the crisis, because if you think

about it, if there are three agents in an economy – individuals, companies and

governments – if individuals and companies spend less and invest less, if the

Government also spends less then what you end up with is a much smaller

economy. The Government in those circumstances should invest more to

actually counterbalance the contraction that is going on from the private sector.

George Osborne, for reasons best known to himself, took what was just a

moderately recovering economy in 2010 and killed the recovery off by clonking

it on the head with tax increases, with big cuts in public spending, particularly

capital spending and by destroying consumer confidence. It suited the

Government’s political objectives to say that Britain was going to be the next

Greece, but that was completely counterproductive. It was wrong, but it was

also guaranteed to make people feel less secure about going out and spending

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