There is a near-constant torrent of media attention on the fundamentalists of ISIS (Daesh) operating thousands of miles from UK shores. Yet the real and present danger from fundamentalism comes from a source much closer to home, the UK’s Conservative government.
What is a Fundamentalist?
A Fundamentalist, or zealot, is someone so consumed by an ideology, that they fight for its implementation in the face of any and all contradictory evidence. While say, a Christian Conservative zealot would hold fast to the idea of Creationism (that the world was created 5,000 years ago by an omnipotent God) in the face of fossils ad other scientific evidence that the world is at least 4.2 billion years old.
For a pro-Austerity zealot, there is just as ample evidence that their policies are damaging and destabilising the economy, rather than building recovery – and yet they pursue their agenda unimpeded by the facts.
The Case for Austerity Blown Apart
The Theory
The evidence base for Austerity was dealt a hammer blow in 2013 by the discovery that the definitive economic paper underpinning it was based on a single Excel spreadsheet with a faulty column. The IMF called for a rethink on Austerity, the UK’s credit rating was downgraded, the economy stalled and unemployment rose. Only an Austerity fundamentalist would continue with such a clearly bogus policy. Yet, they did.
The Practice
Some might argue: ‘Ok, so the scientific paper was bogus. But there could have been real world results that made keeping with the policy a sensible choice?’
That’s a totally legitimate line of argument. It is also totally undermined by the evidence. A simple case study between countries which applied Austerity policies after the 2007/8 Financial Crisis and those who didn’t reveals a clear picture of the danger of Austerity-thinking.
In 2007/8, two European nations stood on the brink of insolvency – Greece, and Iceland. The proposed remedy for both was a bank bail-out, a central bank loan and austerity. While Greece’s political elite embraced austerity, Iceland rejected it.
First, a look at Greece. The Greek government accepted an £88bn loan from the IMF and the European Central Bank (and the Austerity measures attached) in order to bail out its banks and stay in the Euro.
- The economy of Greece has shrunk every year since.
- The Austerity Programme has turned a financial crisis into a humanitarian crisis.
- By 2013, 11% of the population were living in ‘Extreme Material Deprivation’ without heating, electricity, or enough to eat.
- Unemployment is now over 27% and continues to rise each month, while youth unemployment is now over 59%.
- Unsurprisingly, crime has soared – with burglaries rising by 125% in 2011.
Austerity has been a disaster for Greece. But how did Iceland fare?
Iceland refused to use tax payer cash to honour debts run up by the private sector, jailed the bankers responsible, kicked out the Prime Minister and put him on trial for his part in the crisis, and invited its citizens to write a new constitution.
- Iceland’s economy has enjoyed seven straight quarters of growth averaging 5% a year
- Iceland now has an unemployment rate of just 3%, around half that of the UK and on a downward trend.
- Pensioners receive back around 5% of their average net income as pension.
- Wages have continued to climb since 2011 and are now at an all-time high.
- Icelandic society is peaceful and free of social strife.
There is no competition. Iceland’s decision to reject Austerity economics and apply the principles of justice, and social democracy, meant that the nation was able to rebuild and recover. Greece, by stark contrast, was asset-stripped and exploited for private sector gain.
Austerity in the UK
The picture has just as dark for those battered by Austerity economics back home in the UK.
- The UK Economy has been through a double dip recession since the bailout of 2008 and continues to undershoot growth forecasts by the OBR and the IMF.
- Researchers at Sheffield Hallam University found that around 3.5m people are now unemployed (1 million more than the government’s own figures), with unemployment rates as high as 17.5% in merseyside.
- The Institute of Fiscal Studies (IFS) warns that the governments own figures state that 900,000 public sector jobs will be lost between 2010 and 2017. So far, more than 340,000 have gone.
- Wages have fallen to their lowest in a decade.
- According to the UK Essentials Index, inflation on the essential items that the poorest groups in the country buy has hit an eye watering 33%.
- According to the government’s own figures, 2.3m children are living in poverty. But charity Barnardos reported the higher figure of 3.7m, and 1.7m of those live in severe poverty. To underscore the link between child poverty and the austerity policies that drive down wages – 63% of children living in poverty, live in a home where at least one parent is in work.
Faced with the debunking of the economic ideas behind Austerity, the real-world failure of the policies, and the success of alternative ideas – any rational human being would take pause to reconsider their views. Only a fundamentalist would continue, unaffected by the facts.
UK Prime Minister David Cameron seems positively gleeful at the advancement of his austerity agenda, declaring there is ‘no end in sight’ for the programme of public sector cuts.
The political leadership have rejected the fact the evidence for Austerity has been undermined, they have rejected the criticism of the architects of Austerity itself and they have rejected the reality of its devastating results on the ground. These people are not rational, they are fundamentalists – and they are the single greatest threat to our nation right now.
Featured Image via JIDF
