Margaret Beckett, The Independent
On September 15, 2008, when Lehman Brothers filed for bankruptcy, it marked the beginning of the global financial crisis. Right now, we are hurtling towards a new calamity, entirely of our own making, and apparently unwilling to ask the people if they are happy to come along for the ride.
In truth, the disaster that befell the world economy more than a decade ago was much more than a financial crisis. It was a social and political crisis – a landmark moment in the erosion of trust between citizens, authorities and experts in those countries most affected.
In the UK it was cynically and cleverly recast not as an international crisis but a domestic one, by then shadow chancellor George Osborne. He talked of an “age of irresponsibility”, blaming the then Labour government for failed regulation and soaring debt.
A year later, he talked of spending on the nation’s credit card: “Free social care. Free hospital parking. Free childcare places. We would all like those things. But where is the money coming from? He [Gordon Brown] is treating the British people like fools.”
Boris Johnson’s elevation to No 10 seems to have marked the end of the hard austerity that followed and every new day seems to bring further promises of increased government spending. This time £1.8bn for the NHS, to add to the £7bn to raise the income tax threshold, £1bn for extra police officers, and tens of billions on free ports, full-fibre broadband, and HS3 linking Leeds and Manchester.
When asked where the money is coming from, ministers resort to smoke and mirrors, even claiming that the extra “fiscal headroom” Philip Hammond once said would be available if we left the EU with a deal, as opposed to without one, is a real stash of cash burning a hole in the Treasury’s pockets.
But it begs the question, what would Osborne say about the level of debt his former government is getting itself in to resolve Brexit, the self-inflicted domestic crisis?
In the week after the Bank of England has downgraded its economic forecasts for the UK economy predicting a one-in-three chance of a recession, we are faced with the prospect of government borrowing in excess of £6bn to plan for no deal.
The nation’s debt in 2019 is approaching £2 trillion, totalling 85 per cent of gross domestic product. Compare that to two years after the financial crisis, when debt was less than £1 trillion and at 70 per cent of GDP.
There was once talk of “fixing the roof while the sun was shining,” but borrowing in June 2019 was at its highest since 2015. And now our government is recklessly rain-dancing as we edge towards no deal.
Of course, I reject Osborne’s suggestion at the time that Labour failed to repair the roof and we most certainly did not smash a hole in it, then “max out the credit card” on raincoats. Nor did we tour the country in the midst of a crisis promising everything to everyone as Boris Johnson is doing, claiming there is “fiscal headroom”. Johnson is genuinely “treating the British people like fools”.
What we have now is a very real domestic crisis. We are not being brought to the brink by events out of our control. We are deciding the course of our future; except of course we are not being given a Final Say. Everything that is wrong about our country can be fixed by everything that is right about our country. Our principles. Our values. Our belief in the fundamentals of democracy. Our people.
Earlier this year, I put forward a compromise motion to ensure any Brexit deal went back to the people for ratification via a people’s vote. I put my faith in them. It is time this government did too.
So far, I have said that Boris Johnson is likely to be heading for disaster. He seems unlikely to get a Brexit deal through parliament, and parliament is unlikely to allow him to take Britain out of the EU without a deal. Thus he seems to be heading for a “people against parliament” election, in which he asks
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