Keynesian Schadenfreude

I found this article a] illuminating, b] devastating and c] a little bit inspiring. Illuminating because it gave me a good snapshot of the body politic in the UK and the government response to the GFC. Devastating because it makes plain that, of course, the Tories will win, and of course, the Labour party will be punished beyond belief.* And, finally, ever so slightly inspiring because it reminds me that just because ‘the Left’ hasn’t adequately or intelligently responded to the GFC yet [has there been a better time since the 1930s to convince people of the central tenets of Marxism for Dummies?], doesn’t mean they can’t or won’t soon.

I’ve excerpted the best bits in case you don’t want to click through. This is where the author dissects the absurdity of the Tory position, the utter stupidity of which won’t stop them smashing Labour at the election:

Cameron’s main argument – that the economic mess we are in is the result of the failing of big government – is the precise opposite of the truth. The reason for the crisis was not that the state was too active, but that it was too passive. For three decades, from the mid-1970s onwards, regulations on finance were relaxed, markets were unshackled, taxes were cut.

Paul Davidson, in his new book The Keynes Solution, puts it this way: “During almost all of the last four decades the public debate over economic policy has been dominated by the belief that if self-interested individuals are permitted to operate in a free market without government interference and regulation, and without worrying about other members of the community, the resulting free market will bring the economy to nirvana.”

He goes on to reiterate the point later in the article, with appreciable clarity:

Only by the most convoluted reasoning can the crisis of the past two years, and the events that led up it, be described as a failure of big government. On the contrary, it was the deregulation of financial markets championed initially by governments of the right that allowed finance to strip away the prudential controls on its activities.

Over to you. Have you been wondering where the bloody hell ‘the Left’ is since the crash? In Australia, we have a right-wing Labor government. New Zealand : Tories. USA : wha’ happen? And Europe is swinging to the hard right again… Are we letting this opportunity slip through our fingers?

*Obviously, this will be for many reasons, some warranted [Iraq, Catholic control of Downing St etc] and some due to a crazy kind of reactionary populism [rise of the BNP, holding Gordon Brown responsible for Blair’s insanity etc].

Karen Pickering

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  1. Is the opportunity slipping past? Yes, pretty much. It’s extraordinary that there’s been no real opposition to Ruddism from the Left so far. And throughout Europe, with the possible exception of Germany, it’s the far Right that’s gaining, not the Left.

  2. and while germany welcomes the appointment of guido westerwelle, the first openly gay politician to high office [deputy chancellor], it should be noted that the guy is a hard-right free-marketeer of the highest order:

    “Westerwelle is a staunch supporter of the free market and has proposed reforms to curtail the German welfare state and deregulate German labor law. In an interview in February 2003, Westerwelle described trade unions as a “plague on our country” and said unions bosses are “the pall-bearers of the welfare state and of the prosperity in our country.”[5] He has called for substantial tax cuts and smaller government, in line with the general direction of his party.”

    so…one of the last bastions of union power in the world has been declared an enemy of the state by the 2IC of germany. great.

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