Economic debate is completely idiotic, and that’s a serious problem

For the sake of argument, let’s say that you’re the leader of the Labour party, and you’re a bit of a leftie. Perish the thought. You’ve got an idea for a platform for the next general election that you think could be a vote winner and you want to put it into practise. You want to spend more money on the NHS (because it’s significantly under-resourced), you want to build social housing (because we don’t have enough of it and private rents are ridiculously expensive) and you want to renationalise the railways as their franchises finish. All fairly popular policies. Ignore them. They’re just examples. If you don’t like them, pretend they’re your pet policies that need spending. Whatever.

You say you want to do all this, and then a little voice pops up. It’s your policy adviser, and he has a bit of an issue for how this all might go over with the public. “How are we going to pay for it?”, they ask.

Oh. That.

This is the thorny issue with any policy now, because the debate is so completely slanted towards one big-C Conservative stance on public spending that absolutely no method of financing any spending is allowed, and you will be torn to shreds for suggesting any of them:

  • “OK, let’s raise taxes to put them up — taxes on the rich, inheritance taxes, things like that. Few people will object to that.” Bad move — now, in all the papers and in an email campaign the Conservative party sends round about six femtoseconds after the words leave your lips, you are now the wealth-stealing evil socialists returning to “tax and spend” policies. You are now “Red [whatever your name is]” and you are bad and wrong. The implication that raising taxes from the public to pay for things that the public want and need (i.e. the role of government according to anyone who isn’t an anarcho-capitalist loon) is somehow a bad thing to do is ignored. You can’t raise taxes.
  • “Well, we can borrow money, and then the spending will benefit the economy overall and we’ll see growth of many times the amount we borrowed. That’s what the economists say.” Even worse! You can try to make that argument if you want to, however increased public borrowing is now roughly on par in the public mind with sodomising a sheep to death in front of a nursery. (Never mind that the Tories have borrowed more than all Labour governments in history combined.) The papers and that lovely Tory mailshot are now going to refer to you as mortgaging the country to pay for profligate spending that will eventually lead to us becoming like Greece, which is of course a great comparison if you ignore all the ways in which one of the world’s biggest economies with its own sovereign currency and a reasonably efficient tax collection system differs from Greece. Feel free to try to make the economic argument , or even the argument that a business that refused on ideological grounds to borrow at low interest rates to grow itself would be a miserable failure in a world where nobody else has any such compunction — you would be entirely right, but nobody will broadcast it, much less print it, even less believe it, because profligate Greece borrowing mortgage running up the credit card. You can’t borrow money either.
  • “OK, no borrowing, no taxes. Right, sod it, la-la land idea — this bloke says something about ‘People’s QE’. It sounds completely crazy, and we’d have to do it very carefully to not ruin everything, but it might work; it doesn’t involve any borrowing or new taxes.” See the above scenario, only replacing “Greece” with “the Weimar Republic and Zimbabwe”, with the same end result. You can, again, argue that judicious use of the Peoples’ QE idea to fund public services is a bit different from a forcibly-deindustrialised power with a shattered economy arbitrarily and endlessly printing money to repay an externally-imposed inter-war debt it couldn’t possibly afford to repay otherwise, or a corrupt African basket case printing money to finance a war, but nobody will listen. Your name is now somehow integrated with that of Robert Mugabe in the public eye to form another delightful nickname (because nobody knows who the leader of the Weimar Republic was). You can’t use this idea either.*

You’ll notice that there is a fourth option which the Conservatives won’t whinge as much if you do it, or the media that supports them. That option is “don’t spend any more money on anything”. That happens to be the option which they intend to pursue themselves and which suits them ideologically. It is also the only answer that is now acceptable in mainstream public discourse. Ed Miliband ended up in this bind in 2015; he was completely beholden to the public perception of Labour as financially profligate, and acutely aware of the fact that every penny of spending Labour proposed would be scrutinised in great detail while the vagaries of half-baked Tory pledges like a £12bn saving on benefits (which no Tory deigned to explain or pinpoint at the time) or a massive splurge on the NHS (ditto) would be given the occasional going over in interviews with Andrew Neil that nobody watched. As a result, he ended up trying to push the idea that he would spend more and cut the deficit, but couldn’t say that he wanted to do so by cutting the deficit slower (i.e. borrowing more) because he’d be savaged, but his only reward was to be savaged for not saying how he was going to pay for his pledges.

Essentially, through an absolutely incredible PR machine and the willing participation of a media that is at best allied with the Tories for convenience and at worse actively supportive of them, Labour has been constrained into a single binary choice as regards the economy: they can either not spend any money on anything, or they can be a bunch of profligate tax and spend socialist Greece Weimar spendthrift irresponsible can’t be trusted Mugabes. At the same time, the Conservatives can make as many unfunded promises as they like, borrow as much as they like and miss as many of their idiotic, ideological deficit reduction targets as they like, and not suffer anywhere near the same level of scrutiny or public bollocking. They know full well that their programme is economically indefensible, in fact outright harmful, but know they will receive precisely zero scrutiny for it. The only people who will care are the people who already vote Labour sharing stories about it on Twitter and tutting.

Usually, I think blaming the Tory media for Labour’s unpopularity is, at best, an attempt to shirk blame; a means of Labour activists passing the buck for the party’s manifest failure at ginning up a coherent public relations strategy that doesn’t revolve around Facebook and Twitter echo chambers. However, most peoples’ exposure to news about the economy and economics is through that same Tory media, and its politically motivated monstering of any means of financing public spending has destroyed any meaningful public debate on the economy or the government’s role in it. It has turned what should be a rational and serious debate into a completely irrational one moderated by petulant children, where all but one option is taken off the table and anyone who disagrees is a dangerous and stupid lunatic, crippling the ability of Labour (or anyone else) to put forward any alternative economic arguments without being dismissed out of hand. I have absolutely no idea how this could be solved, or if there is any way around it; but then I am not the Director of Communications of the Labour party, and I would hope to Christ that whoever that person is incredibly competent at PR and has some really solid ideas for doing so, otherwise the 2020 uphill struggle is only about to get a bit steeper.

…Oh dear.

*For what it’s worth, I don’t think Peoples’ QE as espoused by John McDonnell and co is a terrible idea as such, but it would clearly need a lot more thought before it was used, if at all. It’s nowhere near an unequivocal good.

Originally posted on Medium.