English Labour showcases its economic illiteracy - again

Published in the Edinburgh Evening News, March 8, 2024.

Viceroy-in-waiting Ian Murray implies that English Labour alone understands the economy and is prepared to make “tough decisions.”

God help us. Reacting to Jeremy Hunt’s budget, Keir Starmer proclaimed that the Tories have “maxed out the national credit card.” This is the same trope the Tories themselves regularly trot out to justify their public sector slash and burn strategy.

The government isn’t like a household that’s recklessly overspending and running up the credit card. Government doesn’t have a credit card - it doesn’t need one. It has its own central bank that issues as much money as required to support the economy. It doesn’t depend on tax revenues or borrowing to finance its spending and can never go broke.

The ‘deficit’ is peoples’ savings. There’s never been a shortage of people wanting to save with the government – it’s the safest place to put your money. Cutting the deficit means taking money out of the economy and out of people’s pockets. It’s fiscal surpluses, not deficits, that consume peoples’ savings.  

Every deficit is good for someone, but for whom? Tax cuts for the rich don’t help the poor. If shared prosperity is the goal, spending on healthcare, education and public infrastructure creates the rising tide that lifts all boats, as does curbing corporate monopoly power, reforming tax policy and strengthening trade unions.

So why the deficit scaremongering?

The dirty little secret is that both the Tories and English Labour want to deny people the public services they need and deserve. They’ve been captured by special interests who thrive on wealth extraction that is immiserating the people.

Government’s purpose is to support an economy that benefits everyone. In this, the UK has failed and Scotland has borne the brunt of this failure.  

That’s why we must end this union.