Conservative Ideology Fails British Economy

Gideon George Osborne likes people to refer to him as just “George Osborne” to show how down to earth and ordinary he really is. But honestly, he is just like you and me — that is, if you happen to have inherited a huge amount of wealth from your parents and are personally responsible for the declining rate of growth in the British economy — then he really is just like you. The privately educated, Oxford buddy of Prime Minister David “Dave” Cameron, Osborne is exactly the person you would not choose to be Chancellor of the Exchequer, Britain's Economic and Finance Minister — unless you’re David Cameron.

Osborne and Cameron have no idea how most Britons live, and it shows in their approach to government. Their neo-liberal forms will enrich only those who are already wealthy while impoverishing the rest of society.

It was revealed this week that the economy of the UK grew by just 0.2% in the second quarter of 2011. Compare this with 0.5% in the first quarter and -0.5% in the fourth quarter of 2010, and it becomes apparent that Britain is not going anywhere fast.

But wait: It was that extra bank holiday for the royal wedding that slowed growth; it was the tsunami in Japan; it was the unseasonably hot weather. It has nothing to do with the government's cutting a fifth of all public spending or the constantly repeated narrative from the Conservative party that unless they crippled social services and cut taxes, Britain would end up like Greece or Italy or the increase in VAT. I’m sure that had nothing to do with it at all.

The recovery from the 2008 recession has so far been the slowest since 1934. In every recession the UK experienced in the 20th century, GDP has been restored to its pre-recession levels by this point, except for after the Great Depression. And the only reason the recovery so far has been slower is because the Great Depression eradicated a much greater proportion of value from the economy. Combine this with ever-increasing UK bond yields and the argument for austerity looks weaker and weaker. Even the world’s governing financial elite — a group traditionally in favor of free market reforms — seem to think Osborne has gone too far. Gideon’s ham-fisted approach to economic policy and his relentless adherence to an out-dated neo-liberal ideology have led to the UK’s increasingly being perceived as a risky investment. 

Cameron and Osborne have been in a vulnerable position from the start. Failing to achieve a parliamentary majority in the 2010 election, the Tories were forced to ally themselves with the ideologically opposite, Liberal Democrat Party to form a coalition government. Huge public spending cuts were justified by ideological rhetoric and a nauseatingly banal and factually inaccurate argument that Britain had "maxed out its credit card."

Osborne’s austerity program is due to cause immense suffering amongst Britain’s most vulnerable citizens who have already begun to organize and take to the streets in protest. Gideon should hope the economic growth he promised shows up soon, or he and his mate Dave may find themselves joining the unemployed, with only their millions of pounds in personal wealth for comfort.

Photo Credit: Wikimedia Commons

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Matthew Hutchinson

Matthew Hutchinson is a recent graduate of Indiana University’s School of Public and Environmental Affairs having previously earned a Master’s degree in European Studies at the University of Westminster. In the spring of 2010 Matthew won the University of Toronto’s Silvia Ostry Prize in Public Policy. His work has also appeared in Public Policy and Governance Review, The Journal of Environmental Studies and Sciences, The Indiana Business Review and Incontext magazine.

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