Behind all the budget ballyhoo, the picture is clear: capitalism is in intensive care and the Tories have deployed the state to keep it afloat at the expense of the majority of the population.
Though the pandemic has exposed the failure of an economic system based on endless growth to sustain profits, the Tories (and Labour under Keir Starmer) are tied to it by a political umbilical cord.
The two major parties contend to show whose policies can best muster the capitalist state’s resources to prop up an unsustainable system. They are engaged in a gigantic con-trick at our expense.
By the end of this month, nearly £400 billion of borrowing would have been thrown at the economy in 12 months – far exceeding the total spent on bailing out the banks in 2007-8 – and in tax breaks for the middle class climbing the property ladder.
If the Tory government has a plan, it is to make the majority suffer in a bid to take the economy off life support, returning the system to the pre-pandemic world of low-wages, precarious employment and run-down communities.
Even chancellor Rishi Sunak admits this could take five years or so. In his dreams. The global economy is shattered. Staggering before the pandemic, international output and trade is in a slump while global debt has reached unheard of levels.
So ruthless exploitation of those lucky enough to have a job is a precondition for any “recovery”. As for the corporation tax hike, most major firms like Amazon are registered offshore to minimise their liabilities.
The Institute for Fiscal Studies (IFS) estimates that taking account of plans announced last autumn, spending will fall £50 billion relative to pre-pandemic forecasts. IFS director Paul Johnson said plans to cut a further £4bn from public spending could be would cause “additional pain” if they went ahead and added that “the chancellor isn’t really levelling with people about the choices the government is making to repair the public finances.”
More low-earners will be brought into income tax, for example, while the universal benefit top-up is due to end later in the year. The Joseph Rowntree Foundation and the Resolution Foundation said the cut in universal credit would bring the incomes of benefit recipients down to levels not seen since the early 1990s.
It would also pull 500,000 people into poverty, including 200,000 children. They pointed out that the Budget was silent on helping 700,000 households who have fallen behind on rent because of the pandemic and are now at risk of eviction.
This is austerity with a vengeance.
So, you might wonder, what is the point of an economic and political system that works only by sustaining a framework of exploitation of both people and planet, which in turn is dependent on vital public resources?
To ask the question is to answer it.