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Austerity America

Tuesday, May 31, 2011

Britain has begun to make the United States appear, by contrast, a nostalgic bastion of unchanging political custom and ideological continuity.

As the 44th president of the United States banqueted with Queen Elizabeth and barbecued burgers with Prime Minister David Cameron, perhaps American thoughts turned briefly to the old country. Pay attention at the back of the class! Not Ireland, but England. Or, more accurately, Britain: which, for pedants out there, is the proper name of our state. And perhaps the image that comes to mind is of an ancient constitution, of a class system, of customs dating back a thousand years, of political traditions that make the USA still feel young—still promising, still pregnant with that dream thing.

Yet, for as long as I have lived in my peculiar nation—in which England, Scotland, Wales, and Northern Ireland form an asymmetrical puzzle of constitutional arrangements with a British umbrella state that still lacks a written constitution—only one thing has remained consistent. There has never, in my lifetime, been a status quo, nor any political argument of any significance that seriously advocated one.

American austerity: it’s difficult to think of a less American state to be in.

No one in Britain under the age of 60 can remember the true “one nation” conservatism of Harold Macmillan, the prime minister who symbolized a sepia-tinted, patrician, Edwardian-style establishment, but nevertheless edged the country into the early 1960s to pursue its true path, which was continual change. No one over the age of 30, meanwhile, will ever forget the Tory rule of Margaret Thatcher. She was a conservative in name alone. She might have spoken of patriotism, tradition, and family values, but she was a revolutionary. She laid waste to trades unions, assaulted the citadels of the bureaucratic Left, went to war with South American fascists, opened labor markets to immigrants, and tore apart an already fractured class system. If she left a few things unchanged, her brain-child on the opposing Labour benches, Tony Blair, would later set about changing those, too.

Our current sub-aristocratic, Tory Prime Minister, David Cameron, now persists in trumpeting a curious hybrid theory to explain his vision of small-government capitalism with a social conscience—entitled the “Big Society.” Policy intellectuals on one side have promoted it as “Red Toryism.” Policy intellectuals on the other side have responded by advocating “Blue Labour.” Confused? We are. Ever since Blair started copying Bill Clinton’s triangulations, we have, apparently, been borrowing American political tactics and ideas. One can only assume that these got lost in the translation. Britain has begun to make the USA appear, by contrast, a nostalgic bastion of unchanging political custom and ideological continuity.

The British have become a nation of protesters. We go on marches all the time. We go on more marches than the French. Did anyone in America notice the “Countryside Alliance” marches of 1998 or 2002? There wasn’t a Trotskyist or anarchist in sight. Protesters came from the rural heartlands: farmers, gamekeepers, aristocrats. Inspired by the micro-issue of a government ban on fox hunting, these forces of an ancien regime formed the biggest public protest of modern times. Until the Iraq war marches, that was. A million people in London marched against George Bush and Tony Blair’s invasion plans in 2003. And who were the marchers? Left, Right, centre, middle class, working class, radical Islamists, Anglican liberals, Catholic conservatives, teachers, doctors, journalists, bird-watchers, UFO hunters…

There has never, in my lifetime, been a status quo, nor any political argument of any significance that seriously advocated one.

Now, thanks to a global financial crisis and the overdependency of the British economy on its financial sector, we are just a step away from Irish-style bankruptcy. So, naturally, we have set about protesting the cuts being implemented by the government—itself the unlikeliest hybrid of conservatives and liberals in British political history. Perhaps it wasn’t surprising that students marched against university fees in England (in Scotland, college education remains, amazingly, free of charge). Even less edifying, however, was the belief evident among student bodies that they were on the left, fighting a right-wing “establishment,” one depriving people of their “rights.”

This was, if you’ll pardon the British vulgarism, total crap. More than half of those who graduate school now go to university in Britain, on account of a rapid expansion of higher education Blair accelerated. British higher education in the 1960s was certainly elitist but—because only a minority went to university—it was relatively cheap. Now that it is more egalitarian, it is much more expensive. In effect, what the revolting students wanted was free higher education for those whose higher education would make them richer—paid through taxes from the less-educated, and therefore poorer.

Less hypocritical, but even more heart-sinking, was the “March for the Alternative” earlier this year. The government is implementing cuts to public spending of £81 billion. The depressingly ineffectual leader of the Labour opposition, Ed Miliband, says he would limit these cuts to £40 billion. That’s like telling mobsters they’ll get the rest of what you owe next week. Economists—as is their wont—disagree on whether cutting fast or cutting slow is the more sensible option. There may be reasons for traditional British grumbling in all this, but certainly no manifesto for liberation. “Please cut more slowly” must be the least exciting protest slogan in the entire world history of civil unrest.

Naturally, we have set about protesting against the cuts being implemented by the government—itself the unlikeliest hybrid of conservatives and liberals in British political history.

Britons persist in disliking the status quo for the obvious reason that they don’t like being in a fiscal mess and do not wish to enter an era of austerity after decades of prosperity—or, more accurately, profligacy. But is there any alternative to Chancellor George Osborne’s program of cuts? Britain was hit particularly hard by the financial crisis because it has a disproportionately large banking sector. The City rivals Wall Street in size, but the British economy is a seventh of the size of America’s. We have just learned that total government debt—the cumulative amount borrowed over several decades—has reached £893.4 billion, equivalent to 62.1 per cent of Gross Domestic Product.

One can argue over the relative merits of each individual cut, but the overall direction of policy is inarguable. Over our shoulder, we are haunted by the moaning ghosts of Greece, Spain, Portugal, and Ireland begging from Brussels to be bailed out by a Eurozone which is itself in crisis.

However much the British may protest, the promise of austerity and the certainty of cuts is the status quo. There is no alternative. But perhaps the oddest feature of our current predicament is the composition of the government now advancing those cuts. For the only time since the Second World War, Britain has a coalition government, made up of a majority of conservatives and a minority of liberals. (The latter are not liberals in the American sense; they are more like social democratic Scandinavians.)

The United Kingdom does not have the kind of voting system (proportional representation) that regularly produces coalition governments on the European continent. It has a first-past-the-post system that routinely produces outright majority governments. A freak event produced a result in which Cameron’s Tories won yet lacked a sufficient number of members of parliament for a clear mandate to govern. Instead of forging an alliance with then-Labour leader Gordon Brown (which would have been their natural inclination), the Liberal Democrats, led by Nick Clegg, opted to abandon their habitual post as the eternally impotent “third party” to join their ideological adversaries in the Tory party—and actually to take power.

However much the British may protest, the promise of austerity and the certainty of cuts is the status quo.

The result is a coalition government for which no one voted. The Tories, particularly those on the right, detest having to share power with limp-wristed liberals. The base of Liberal Democrat support, meanwhile, feels betrayed by jumping into bed with malevolent, small-government Tories. The polls show the Labour Party, despite being a shambles, with a clear lead. Cameron and Clegg are clearly feeling the tensions in their relationship.

Yet this fragile status quo may well be the best possible solution for the country. The Liberals may yet moderate the Tory Right; the Tory cutters can continue to bring realism to liberal-left wishful thinkers. If only the country could embrace the reality. None of us got what we wanted, but we very likely got what we needed.

Does Britain have lessons for America? We would love to think so, self-regarding and vain though that sounds. President Obama’s visit last week has focused on things that flatter the British with the illusory feeling that their small country still plays a big role in world affairs: the Queen, the “special relationship,” Afghanistan, the Middle East. The economy of neither country has featured much in the Obama-Cameron talks.

Yet we still remember the moment Bill Clinton announced that the United States had a surplus, not a deficit. Even more than military might, that appeared to us like real power. As much as the ending of the Cold War, that was the moment the USA unequivocally, though only-too briefly, ascended to its role as the sole superpower in a unipolar world.

Then, a few wars and a financial crash later—following some less-than-brilliant economic and financial management fromthe George W. Bush administration—America has joined the collective of debtor nations, throwing good money after bad, and a lot of it to China.

In 2011-2012 the British government will likely spend £50 billion—25 per cent more than its defense budget—on interest payments alone. The American deficit, meanwhile, is forecast to reach $1.5 trillion later this year.

It’ll be hard for us. The true austerity measures of the Second World War are a grandparental memory now—“Blitz spirit” and stiff upper lips, the stuff of myth. We have become an emotionally soft people: the heirs of Princess Diana. But I suspect it’ll be harder for you. American austerity: it’s difficult to think of a less American state to be in. No one likes that kind of status quo. But it must be the only dream in town.

Alexander Linklater is an associate editor of Prospect magazine.

FURTHER READING: Michael Barone discusses “Why Do Parties Last Longer in Britain?” and Desmond Lachman compares international debt-to-GDP ratios in “The Emerging Markets’ Century.” Lachman also explains “Why Europe Matters” to American debt problems, Jonah Goldberg says “Fools Rush In Where Europe Rushes Out,” and Gary Schmitt examines “Cutting Defence—Tory Style.”

Image by Rob Green/Bergman Group.

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