Debt, essentially public debt, has been ideologically manufactured by political leaders in a symbiotic relationship with the media as a travesty. If not reduced, we are told, it will destroy the hopes and futures of generations to come, but in the words of a left wing Manic Street Preaches song about the Spanish Civil War, “if you tolerate this, your children will be next”, applies rather to the hopes, dreams and opportunities being slashed by those neo-liberals at the top, rather that the fact we have debt. Furthermore, so-called public debt is actually largely a result of private debt as banks were bailed out by more than £1.5 trillion in the UK, for instance. Insanely, however, leaders have used this conversion to ideologically blame the public sector, whilst championing the poor old neglected private sector, despite the fact that the ‘ethos’ of the private sector got us in this mess in the first place. Despite endless speculation in a system based on economic inequality, accumulation and profit, the public sector is paying through benefit cuts, job cuts, wage cuts, pension cuts, service cuts and so on.
Even if we had a ‘debt problem’, leaders keep ignoring the realities of what their neo-liberal driven policies are doing. You only have to look at how the Tories are borrowing more than they expected, despite aiming to eradicate the structural deficit, because of their crash and burn, social Darwinism policy framework. Furthermore, ‘new’ Europen guidelines are set to bring in the European Court if countries breach the 60% GDP debt and 3% GDP deficit limit – something countries such as France have got away with before. Despite Greece’s second bailout, based on the best case scenario results, the new bailout is set to only reduce debt from 160% GDP to 120%, whilst minimum wage is cut by 22%, unemployment reached a new high of 20.9% alongside the constitution now enshrining a new commitment to debt repayments being more important than the funding and maintenance of services!
The state, despite free market Ayn Rand lovers promoting their right wing ‘objectivity’ hate whilst playing the ‘victim’ card , is needed for the market to work. You only have to look at the market’s reliance upon the state to underwrite debts and loans – and the ramifications of what would have happened if the banking system had crashed in 2008. This brings me to another inconsistency. The Conservatives supported Labour’s spending plans up to 2008. Therefore, the Tories have an important choice to make regarding their economic narrative, given they often resort to the tiresome ‘it’s Labour’s fault’ line when their backs are to the wall. They either argue that they supported the prevention of an economic collapse through a bailout of the private sector, therefore turning private debt into public debt, or they say that such accumlation of public debt is not worth saving the economy and therefore outline what they would have done when we would have reached the point that people were unable to pull money out from the cash machines.
This all relates to an important question of whether democracy, essentially the dominant liberal democracy, is being challenged due to the economic crisis. For Immanuel Wallerstein, the mastermind behind world-system analysis, real democracy cannot exist in the current world capitalist economy because of endemic material inequality and exploitation. However, Wallersetein believes that this recent economic crisis is resulting in leaders’ power being fundamentally challenged, as their ideas are becoming harder to put into practice. Is the liberal idea of deregulation, free market, privatisation and profit too endemic within society to be challenged? Or is the right wing ideology of endless accumulation and an attack on social services and provision by the state, with a neo-liberal senseless clampdown of so-called debt crisis sustainable?
We have notably seen the development of individualism since around the 1970s/80s, especially after the so-called post-war consensus, where the Conservatives found it very hard to break with the social democratic Keynesian position with the welfare system constructed on the back of more than 250% GDP debt. The creation of the credit card in the 1950s was central to people’s access to credit. However, the 1970s/80s new right movement was also a backlash to the progress that had been made in the 1960s by civil right groups/organisations and the like. The 1970s/80s onwards saw the production of an isolated, self-sustaining individual, influencing the idea and views people have of democracy. The classical Athens polis idea of democracy was substantially forgotten by many, as anything fundamentally posing a challenge to capitalism and neo-liberalism was cast as the ‘enemy’.
However, as the current Tory party begin to hit more and more people, effecting more and more areas of life than Thatcher even dreamed of; as they cut on average 19% from each government department, cleverly resulting in local councils taking the brunt for the central government’s destructive local government grants/budgets cuts – more and more people are becoming activised. As people watch the developments of the international arena, as the Euro-zone becomes even more shaky and countries such as Greece are run into the ground by a neo-liberal agenda that does not work, how long until the system implodes?
This relates to the idea of whether right wing ideology is sustainable. Specifically, consider the so-called falling rate of profit. This is something ecosocialists have picked up on when talking about the effects of capitalism upon the environment. Essentially, to try and keep up with the advancing technological developments, capitalists invest in capital, which costs to run, update and modify, whilst products prices go up and wages are cut, or jobs are lost to maintain a profit. As a result, less people can afford to buy the products and so the capitalists have a problem on their hands. This relates to the endless search for new natural resources to exploit, until one day these resources will run out and it becomes more expensive and harder to find the next replacement. Trying to make money out of everything, when most things in life are finite, will only result in the implosion of a system containing the seeds of its own destruction. It all relates to the endless production and consumption goals of the current system, and the continual treatment of natural resources (and animals) as commodities invested with an exchange value, important for the creation of surplus value.
The right wing critique of debt, whilst supporting the capitalist system reeks of inconsistency. For instance, David Cameron argues that consumer/personal debt is one of the biggest problems and needs reducing for the crisis to ebb. Sure. But then he ignores how influential his policies are in creating this sustained debt, the every growing reliance on loans and credit due to the inability to get a decent paying, enough working hours job alongside benefits and services being cut. Furthermore, despite being critical of debt, the capitalist system Cameron promotes NEEDS debt. It needs consumer debt so consumers spend and profit goes up. For the system to achieve endless accumulation, debt is an endemic facet of the capitalist world system.
The adoption of this right wing ‘logic’ is something that has and will cost the Liberal Democrats dear. For me, the Liberal Democrats are demographically over. By this, unlike Labour and the Tories, they have no core group to rely and fall back on. Rather, their continual preaching that they have nothing to say sorry for, then backing an NHS bill that they say isn’t even theirs (despite the flip flopping of their party members), whilst supporting the most right wing government we have had for many years, has cost them their claim as a protest, anti-establishment vote. Come the next election, they will pay the price through seats and votes.
Democracy, essentially liberal democracy, is under threat from an inconsistent right wing argument and action on debt and capitalism. The system is unsustainable. Sadly, it seems that we will find out the hard way.
Jane Watkinson is a sociology graduate and currently undertaking an MA in politics. A member of the Green Party, but with anarcho-communist leanings, Jane keeps a blog at Jane’s Political Ramblings that advances left wing, feminist and social justice principles. Jane is also a director for the progressive social enterprise, SilenceBreakers. You can find Jane on Twitter @JaneWatkinson