The politics of Rachel Reeves spending review looks like this:
Voters are being told that the problems are so great that investment needs to come before the redistribution of the fruits of (future) economic success.
The problem is for the less wealthy, and especially the poor, this has been the implied message of politics for decades; a tale of prosperity deferred.
Many will now dismiss such a message on the basis of previous experience... leaving Labour politically exposed?
Indeed, as Gerald Winstanley (the Digger's leader in C17th) said (and I paraphrase):
Our rules like to have the workers eyes turned up to God, so to better be able to poke them out
It's the 'trickle down' message again - it has zero credibility not only because we've head it all before, but because there's bags of objective evidence that for 40 years the fruits of investment are enjoyed almost exclusively by the already wealthy.
I'm really at a loss to understand this government's economic thinking. With the Tories it was easy - they have always put the interests of the wealthy and privileged above those of the country - but with Labour it just all seems totally arbitrary... directing environmental spending into carbon capture and nuclear power, which are known not to work... advocating Keynesian defence spending when it's known multiplier effects are much greater for other public spending... most of all, not even addressing the unfairness in the tax system, which means the wealthy pay less than the poor, and exploitation through higher rents, etc, is fiscally rewarded - when moving towards fair taxes - eg. raising CGT to the same rates as Income Tax, ending high income subsidies like the NI rate ceiling, pension tax relief rates, etc, etc, - would address both perceived spending constraints and begin to tackle the social inequality that is really at the heart of the UK's economic problems - would not break Labour's manifesto pledges, AND would be popular with most voters.
The only explanations I can think of are:
1. They are being advised by covert Tories (and are too stupid to see it); or
2. They made Faustian secret promises to media owners, fund managers, whoever...
@aral @GeofCox @BashStKid @ChrisMayLA6
Institutionalised thinking is my best guess. e.g. Enough to morph a human rights lawyer into a facilitator of genocide
3. they're prisoners of UG/MA economics, the simplified orthodoxy that @sjwrenlewis calls 'media macro'.... they seem completely unaware of heterodox economics, and its very different view on the state's positive role in the economy....
There is rather more redistribution in the #comprehensivespendingreview than would appear at first reading. However it has taken the form of #socialtransfersinkind - usually abbreviated to #STIK - rather than cash. #nhs spending has been estimated to have a particularly strong redistributive effect so the concentration of growth in day to day spending on health will have turbocharged this. So quite a strong case can be made - but not clear #labour communications are up to it!
Hmmmm... there's an old (possibly apocryphal) story relating to Gordon Brown; one of his aides was once heard to remark 'the problem with Gordon is he doesn't seem to understand the poor don't have money'....
So, yes I can see that one might make an argument for social transfers in kind, but in the immediate everyday, for most people struggling with their finances this won't really be noticeable....
And funny how 'transfers' to the rich always come in cash, bonuses, tax reliefs etc
For historical and personal reasons I am particularly keen on including #stik in distributional calculations. However I do suspect that the argument has been overdone slightly on this occasion. I also have a feeling that health spending may be rather less redistributive at the margin than overall. This is I fear something of an academic argument since I doubt whether #labour officials can understand the issues let alone communicate them!
yes, I would agree
Yup, we're on the same page
@ChrisMayLA6 I've thought this, particularly around WFA.
Stamer and Reeves have been very consistent around claiming the matter being due to the state of the economy: WFA had to be cut to save the economy, and they could put it back because the economy was healthier (and not because they got a drubbing in the locals), meaning surely WFA is going to be first on the chopping block when the economy next takes a knock, which isn't going to be reassuring to people worried about losing it in the first place.
To a certain extent also, I'd argue that it's Government's job to *protect* us from the economy- like how Social Security is there for when work isn't, how Furlough and all sorts of business reliefs were there at the start of the pandemic and so on- and here they are, fairly explicitly saying that isn't what they're going to do.
Your second point is right on the button; this would be how heterodox political economics from JM Keynes to Karl Polanyi in the past, and people like Kate Raworth and others nowadays would see the role of the state.
In the terms of Polanyi; one of the key jobs of the state it to re-embed the economy in social relations via regulation so that markets allocation function service the general good not just the interests of owners of capital.
@ChrisMayLA6 Playing right into Reform’s hands. Who will use their popularism approach to say “We will fix your problems immediately”
(Narrator: They won’t but by the time they’re in power it will be too late. See America for an example)
Always 'jam tomorrow' from Tory Lite.
Emeritus Prof Christopher May
@MiBro54517
BashStKid
GeofCox
Aral Balkan
Jonathan Schofield
beemoh
Donald Roy
Kim Spence-Jones 🇬🇧😷
HighlandLawyer
Marcus The Board Gamer
Steve Holden
Richard Michael Blaber
Jna💚
Mainly Walking