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Monday, October 18, 2010

The big lie?

Talking about propaganda techniques, there is an intriguing letter in this morning's Western Mail from somebody called John Owen from Caerphilly. He claims that the argument that Labour left a terrible financial legacy is being propagated on the basis of Heinrich Himmler's doctine that 'the larger the lie you told, the more likely people were to believe it.'

In fact this expression was coined by Adolf Hitler, when he dictated his 1925 book Mein Kampf. he wrote about a lie so "colossal" that no one would believe that someone "could have the impudence to distort the truth so infamously." According to Wikipedia, Hitler believed the technique was used by Jews to unfairly blame Germany's loss in World War I on German Army officer Erich Ludendorff. It was a technique later adopted by Joseph Goebbels in his many propaganda efforts. But I digress.

In fact it is undeniable that the present government has inherited a terrible financial mess from Labour. There is a £109 billion structural deficit and £800 billion worth of debt. And as I reported here, it is not all down to the banks or to a global recession.

In a little reported interview, former Cabinet Secretary, Andrew Turnbull left us in no doubt as to how we got into that position:

Turnbull said that that excessive borrowing started to be a problem from 2005. “It kind of crept up on us in 2005, 2006, 2007, and we were still expanding public spending at 4.5 percent a year,” he said, arguing that the Treasury should have been putting more money aside. “You might have thought that we should have been giving priority to getting borrowing under better control, putting money aside in the good years – and it didn’t happen,” he commented.

This is of course prior to the recession that Mr. Owen refers to. If anything the big lie that is being propagated is not that Labour are responsible, but the claims by Labour politicians that the current crisis has nothing to do with them.
So then Peter at which point did you request the Government stop spending money and at what point did you argue for there not to be a fiscal stimulus? You have all argued for this same deficit until it suited members of your party to get a government job.

With your focus on cuts not growth and a ridiculous ratio of cuts to taxes these are certainly your cuts and not Labour's.
Why is the cuts to CB to higher earners gaining so much publicity when the worst off on low incomes and related cuts are not getting publicity. Also are the Libs now going to forge ahead on the family court crisis, wrongfully removed children, dads in poverty because of csa. If money is to be saved then perhaps the fact mothers with custody are receiving all the benefits for the children, as well as receiving maintenance which is not considered in HB or council tax relief etc while non custody dads cannot even afford a pair of shoes out of their wages or have quality contact with their children.
Actually Anon, if you had been paying attention you would have noticed that Vince Cable was warning about excessive borrowing and debt well before this. He was also calling for better regulation of the banks. Something else that Labouor failed to do.

Sheila, I am not in a position to explain why the media distort the Government's position in such a way, commenting on decisions that have not been taken yet. The Family Courts are not part of the CSR and I have no information on plans for them, sorry.
Sheila, John Hemming, MP continues to fight for wrongfully removed children.
And what about your Westminster coalition partners? what was there argument? Or did they also predict that the deficit would grow in the hope that they would then be able to get in office, slash public spending for idiological reasons under the gise of a tough loving school master, cain behind his whitened knuckles, tearfully dishing out the punishment that will do us good? Cable was hardly an economic genius for realising that the problems with sub-primes in the US may become a larger economic problem; the economist was writing a series of articles saying exactly the same thing in 2006 (I remember because I was using them as teaching materials for a business English course) yet it was ignored by almost everyone in power. Indeed if i am correct i think that all he predicted was that northern rock would be nationalised, and indeed in 2003 critisised the IMF when they warned gordon brown against increased spending ? In any case the lib dems (party) seemed to have changed their position so much that I'm not sure that much credence should be given to something that was said by them before the election, whether it is right, wrong or other...
As yet bank regulation seems to be a willow the wisp hovering in the darkness just beyond the horizon, how are we to believe that any of the parties would have done anything different as regards regulation while the banks remain in the same state, as yet none of the 3 main parties have regulated the banks. Indeed, the TUC report - The Corporation Tax Gap - publish today suggests that little is going to change as the banks bailed out during the crisis offset their losses against future profits: dodging a massive tax bill.
The only thing that single mindedly quoting the phrase 'the size of the deficit/mess we were left with... etc" in a knee-jerk fashion is to reduce the quality of debate and to propagate the idea that there is only ever one solution to any given situation, something that is in itself an indictment on the creativity of humanity.
I cannot speak for the Tories but Vince Cable was certainly ahead of the game in terms of tackling UK debt and calling for regulation of the banks. The Economist may have been saying the same thing but the point is that Labour were in denial. This post is about that denial. The claim by Labour that it was not their fault when it clearly was. The role of other parties is peripheral to that argument.

yes, we have changed our position but as somebody who teaches economics you will know that this was inevitable. Nothing stands still and a position you might take one day can easily be unsustainable the next due to changing circumstances. It is not that Vince and the Liberal Democrats have changed their position that is the issue but that they were brave enough to do so when faced with a different situation to that they had envisaged.

As for the banks, work is in progress on this and I believe proposals will be coming forward. We have only been in power a few months so give us a chance. A bank levy has already been introduced.
What about the Welsh Labour promises to improve the awful Welsh GVA rating ?

- well, after over a decade of Welsh Labour, Welsh GVA rating is still in the toilet.

What happened to all those hundreds of millions already spent, and with tens of millions in the pipeline (to buy even more non-Welsh supercomputers even though the current spend of some 20 million plus has so far not resulted in job creating patents) – what is IJW doing? Oh, aiming more tens of millions at ‘empire building’ within the Welsh university system.

I ask a basic question: how come a university with fewer students than Cardiff University is knocking over an order of magnitude more issued patents than all of the universities in Wales combined? (In the largest market for patented goods/services in the world.)

Based on ‘what they’ve done so far”, Welsh Labour and IJW stand for spending money with zip focus on creating job creating patents.

What have we got for the huge investment in Welsh universities?

A Welsh economy in reverse gear is what we got c/o Welsh Labour and IJW.
The cut in corporation tax negates any effect on the bank levy rendering it more or less a prime examples of what the Tories would call inefficient government.

I am no labour apologist, however just to say that "we have changed our position" having earlier riled against those who ideas you considered wrong and have since also “changed their position” seems a little disingenuous, if your position has changed then could it not be argued that the only thing that had kept you from making these same perceived mistakes or other mistakes leading to a similar out come was the lack of power to implement change, as surely the economic situation was clear throughout the parliamentary campaign and throughout the Lib Dems policy making process, indeed the only significant change in the economic situation between the the electoral campaign and Osborne's budget was slight economic growth.

I am sure that many of the Lib Dems in cabinet are doing their best to temper the dismantling of the state and some of the more regressive Tory policy, although how successful they are at this only time will tell. However I am aware that as the Lib Dems are working as a minority member of a collision and as such they will get less of a voice on issues, you must understand though that the perception of Lib Dem politicians towing the Tory line on issues that they campaigned against 6 months ago will not sit well with many, and attacking the opposition in this way will only add to the continued increase in disdain in which the public holds politics; rather than deflecting criticism from the Lib Dems onto labour complaints will just coalesce in the mind of the public to a general criticism to the tune of 'they are all as bad as each other'. (sorry for typos in previous post)
The cut in Corporation Tax is an economic stimulant and has nothing to do with the banks. As for attacking Labour I do not think we should just sit back and let them walk all over us especially when they have effectively restarted history in May. Voters deserve to have the full picture as to why these cuts are necessary.
I would argue that you are not presenting the full picture; you are simply regurgitating the same argument, one all voters have heard endlessly since the election. Representing the full picture would be to discuss other options available, it is not difficult to find economists who disagree with current economic policy.

The intention behind the corporation tax is completely different from the effect it has on the banks, and the net effect that the levy and corporation tax have together.
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