I once studied the philosophy of Michel Foucault the 20th century French writer. Foucault was renowned for his lateral thinking re-evaluating the way in which issues were explored. For instance he remarkably argued that the only sane people were those who actually suffered from mental illness as they had come to terms with their own fallibilities and could therefore rationalise their condition.
This exemplar of Foucault’s counter-intuition could now be applied to the recession. For I believe that the idea that we should now be conducting a Dutch auction of what public services to cut and by how much and how quickly is not only flawed in theory but also in practice.
Forget the politically correct warnings of the Governor of the Bank of England, the mock threats of the credit rating agencies and the continuing misjudgements of so many pundits for collectively they have failed to grasp how serious this recession could still be if we now make the wrong moves. Whilst they are keen on making statistical projections saying how bad things have been what they fail to understand is that by their very actions they will make matters worse.
Imposing major cuts at present will just put the economy back into recession or even worse. Instead of listening to those who have failed us before – and at the very least have responsibility for getting us into this mess in the first we should be taking note of the much smaller group of economists who have a much better track record of grasping what has happened and what now needs to be done.
For instance I would mention David ‘Danny’ Blanchflower or Graham Turner both anti-establishment economists who have continually advocated a view that pre-emptive cuts would be entirely counterproductive and will just endanger, not save the UK and world economies. That’s why I called the other day for Blanchflower to replace Mervyn King as Governor of the Bank of England as this would do more to speed the recovery than anything else. Additionally I felt that just tipping into positive GDP of a 0.1% increase on the previous quarter will eventually be a good thing because it makes less sense to take off the reflationary stimulators yet.
What is depressing is how easy politicians, financiers and public fall for the economic orthodoxy that failed in the 1930s and will fail again today. That’s why we need to take much more seriously the views of those heretics who challenge and dispute the majority view. And whilst doing that we can then turn our attention to the beginning of the end of the casino economy that has done so much damage to all our lives.
David Drew
MP for the Stroud Constituency