It’s not just Tories who want austerity

We can’t make a convincing case against austerity without challenging today’s cultural aversion to prosperity.

Daniel Ben-Ami

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Topics Politics

Something remarkable happened in Britain yesterday, but it wasn’t the Comprehensive Spending Review introduced to parliament by George Osborne, the chancellor of the exchequer. Rather it was the absence of any coherent opposition to what will undoubtedly be a serious attack on popular living standards.

The mass of the population most likely felt a fatalistic resignation at the prospect of spending cuts, rising unemployment and falling living standards. No doubt they were unhappy about what was awaiting them, but they felt there was little they could do to resist austerity.

There were some demonstrations around the country, but they were small and tokenistic in character. Few believed there was much prospect of having a significant effect. The best that most might hope for is that the particular areas they work on or care about should suffer less than others. So they might prefer, for example, for cuts to be lighter in higher education than other areas, or they might be particularly concerned about pensions or welfare benefits.

For anyone with a sense of history, such a passive response must seem strange. There are plenty examples from the past where assaults on living standards have provoked a militant response.

There are several possible responses to this fatalism – but most of them have little credibility. Some conservatives have pointed out that public spending will still continue to rise in cash terms over the next few years. But such an argument is disingenuous, since in real terms, once inflation is taken into account, spending will fall. Once debt repayments are taken into account, along with the protection of spending in some ministries, much of the public sector is going to suffer a substantial fall in spending.

In any case, the official estimate that up to 500,000 public sector workers could lose their jobs by 2014-15 is a good indicator of how hard the cuts could hit. Not only are they likely to mean poorer services for many, but also job losses and greater workplace insecurity for others.

The claim that a dynamic private sector, freed from the shackles of the state, will quickly create new jobs for the legions of unemployed is hard to take seriously. If anything, private sector unemployment could well rise, too, as private businesses are deprived of state support.

Others might blame the pathetic response to the cuts on what is deemed the ‘official opposition’ to the austerity proposed by the Liberal-Conservative coalition. Labour’s reaction is essentially that cuts should be imposed a little later and perhaps a little less extensively than the government suggests. To be sure, the Trades Union Congress has called for a demonstration against cuts – for some time next year.

But only the deluded or those ignorant of Britain’s recent history would have any faith in the desire of such organisations to resist austerity. Apart from anything else, before the May election the Labour Party made it clear that, at least in principle, it saw substantial cuts as unavoidable.

The real reason for the lack of any significant opposition to austerity goes wider and deeper than any of the standard explanations suggest. It is to be found in a strong cultural aversion to prosperity that became mainstream in British society in the 1970s and has strengthened since then. In turn, it should be seen as a central component of a broader social pessimism and retreat from the idea of progress.

This aversion to prosperity is missed because critics of the government typically assume that the assault on living standards will come from born-again Thatcherites. They see themselves as fighting the last war, just as surely as France building the Maginot line, a giant First World War-style fortified trench, to defend itself against Nazi Germany in the 1930s. In the event, Germany easily overpowered the defences using modern armoured warfare in 1940.

The contemporary aversion to prosperity is both more subtle and more powerful than that suggested by the idea of a Thatcherite assault. It takes the form of what I have called growth scepticism: the pervasive notion that economic growth is constrained by limits that humanity attempts to overcome at its peril. Such constraints are not simply seen as challenges but as immutable barriers that cannot be transgressed without causing immense harm.

Growth scepticism points to many such boundaries. The most obvious, and the first to be popularised, is the notion of a natural limit. From this perspective, economic growth threatens to devastate the environment and perhaps destroy the planet itself.

Sustainability is best seen as a variant of the concept of a natural limit. The idea is that economic growth may not pose immediate problems in the present, but it threatens potentially fatal challenges in the future. Climate change is the most popular example of this line of argument.

Another set of limits are portrayed as social. One variant of this is the emphasis on happiness in contemporary society. Influential figures have argued that the overriding goal of society and individuals should be achieving happiness rather than becoming wealthier. Economic growth is therefore downplayed or even stigmatised as causing ‘affluenza’.

An alternative version of the social limits argument relates to inequality. From this perspective, not only is inequality a social problem – it is also an argument against growth. Rising prosperity is seen as inherently dangerous as it can lead to widening inequality. In this view a more equal but poor society is generally seen as preferable to a less equal rich one.

Finally, there is the notion of moral limits. From this perspective, economic growth risks morally corrupting us. By fostering ‘greed’, it is argued that growth brings out the worst in humanity.

Even individually, these ideas call the benefits of growth and the resultant prosperity into question. Combined together, they amount to a powerful critique of affluence.

It is not possible effectively to defend prosperity if it is seen as so problematic by influential sections of society. If growth is viewed as capable of destroying the planet, spreading misery, threatening inequality and fostering greed, it is hardly an attractive proposition. Although people naturally dislike reductions in their living standards, they cannot convincingly argue for prosperity unless they can challenge the portrayal of it as so destructive.

The pervasiveness of this growth-sceptic outlook explains the peculiar, at least in historical terms, response to the prospect of austerity. The overwhelming thrust of the discussion is about what exactly should be cut. There is little debate about the other way potentially to curb Britain’s burgeoning fiscal deficit: by promoting economic growth.

It also explains why the common attempts to argue against austerity are counterproductive. Of course it is understandable that those on normal salaries should be envious of well-paid investment bankers. But the popular discussion of bankers’ greed only reinforces the idea that everyone, from the queen downwards, should be prepared to make sacrifices. The discussion is easily turned towards the notion of fairness: which in practice means a form of green egalitarianism where everyone should be prepared to make sacrifices.

Make no mistake: growth scepticism is widespread and long-standing. A systematic examination of government policy documents, international agreements and the thinking of top social scientists shows the notion of limits running through their view of society. Avowedly green organisations, such as the Green Party or Friends of the Earth, are actually minor players – growth scepticism is a top-down phenomenon.

It also became mainstream during the 1970s – a decade which saw severe economic dislocation and trade union militancy. For example, Britain’s Department of the Environment was founded as far back as 1970, at which time it was the largest such ministry in the world. In the early 1970s there was also a widespread international discussion of the environment which focused on a United Nations Conference on the Human Environment in Stockholm in 1972 – the first large gathering on the international environment. According to the event’s official report: ‘The concept of “no growth” could not be a viable concept for any society, but it was necessary to rethink the traditional concepts of the basic purposes of growth.’ (1)

In the middle of the Seventies, the notion of environmental limits got another boost. The economic crisis of 1973-4 was widely interpreted as being the result of the quadrupling of oil prices that followed the October 1973 Arab-Israeli war. Instead of seeing the social and economic roots of the downturn, it was generally seen as an example of bumping against a natural limit.

Of course the discussion has moved on since the 1970s. It was in the 1980s, with the publication of the United Nations’ Brundtland Report, that the notion of sustainability became officially accepted (2). The idea of environmental limits had taken on a more precautionary tone.

More recently, the 2008-9 financial crisis has given a fillip to the notion of moral limits. The world’s recent economic problems are widely seen to be the result of bankers’ greed rather than caused by more fundamental structural factors.

None of this means that the drive to austerity cannot be challenged. But it does suggest that the old approaches will not work. Simply pointing to the evils of cuts will not be convincing when growth scepticism is so deeply embedded. Looking to the Labour Party or the remnants of the old trade unions is deeply naive. And scapegoating greedy bankers will only make matters worse by strengthening the demand for sacrifice.

Instead it is necessary to go back to first principles. To restate the case for economic growth as part of a broader humanist project of rehabilitating social progress and modernity. Such an approach will not be easy to pursue. Growth-sceptic ideas are deeply embedded in contemporary societies. But it is only through rehabilitating prosperity as a desirable goal that it is possible to make a convincing case for resisting austerity.

Daniel Ben-Ami is a journalist and author based in London. Visit his website here. His new book, Ferraris For All: In Defence of Economic Progress, is published by Policy Press. (Buy this book from Amazon(UK).)

(1) Quoted in Ferraris for All, p60

(2) See Ferraris for All, p36-38

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