Dick of the Year: Alistair Darling
Reading through the nominations on the blog, I’m struck by the rush to slot the political football into an empty goal. Nominating Donald Trump, Nick Clegg or Lord Browne is easy. Their behaviour is so obviously destructive, self-serving and just plain stupid. I always like a more difficult task.
I believe it is Alistair Darling that is responsible for opening the door for the ideologues of the Tory-led government to cut public services. Only because of Darling’s actions were Clegg, Cameron and Osborne able to attack the welfare state, education system and economic support structures. I don’t think he meant to do it, but he certainly wasn’t unaware of the consequences.
Alistair Darling did well in the immediate response to the banking crisis and credit crunch. As a committed neo-liberal he managed the economy well. His actions in rescuing Northern Rock stopped a general collapse of British banks. While his fellow neo-liberals Cameron and Osborne got it catastrophically wrong by urging the government to let Northern Rock go to the wall, Darling stood fast and bailed out the other banks. This may have ensured that the UK economy didn’t collapse.
But then it all went wrong. The bank bail-out increased the deficit to a level where it provided a political opportunity to the right wing press to attack state spending. They were cheered on by Cameron and Osborne. The deficit allowed the free market fundamentalists to attack all government spending.
This was nothing new. For nearly 40 years the same people have been attacking most government spending as waste. But the deficit gave these people an excuse to attack the state, by conflating cutting spending with cutting the deficit. Of course the evidence from around the world is that cutting public spending in fact exacerbates a deficit. By reducing public spending, confidence in an economy reduces, diminishing spending and increasing unemployment. With increased unemployment, so welfare payments increase.
And here’s where Alistair Darling earns his nomination. Gordon Brown wanted to fight the election promising an investment strategy that would allow Britain to grow its way out of the deficit. By strategically investing in the economy, the deficit could be dealt with. By securing high employment and confidence in the economy, Britain could easily pay off its deficit. Nobel Prize winning economists including Paul Krugman and Joseph Stiglitz have supported this strategy. But still Alistair Darling stopped Brown from following this path.
Darling forced Brown to fight the election on a platform that amounted to “Cuts, but fewer cuts than anyone else.” This was exacerbated by Labour’s inability to identify any cuts. So the electorate were faced with three parties all advocating cuts. But only the Tories looked like they meant it. While people didn’t trust them (that’s why they didn’t win), they had won the values argument. They were only able to win that argument because Darling insisted that Labour ran on the basis of making cuts.
Allowing the Tories to become the largest party meant Clegg could bounce his party into government with them. It meant there was a government ferociously committed to punishing the poorest and most vulnerable for the crimes of bankers. And all because of Alistair Darling’s insistence that Labour support cuts.