Morally Opposing the Rally Against Debt

Archbishop Cranmer (well, his imposter) suggests it is not possible to morally oppose the Rally Against Debt. It's hard to find exactly what this Rally stands for exactly, though it is easy to laugh at it. However, one should be a little less childish about it. There are more important things to say on this.

Before getting on to his blather about the moral case, Cranmer notes that:

The Rally against Debt is, in reality, a moral exhortation to people (and so the Government) to live within their means

Now clearly the Archbishop's imposter isn't really reading anything that doesn't support his prior prejudice. Like some basic economics for example. Basic economics says that when an economy enters into a recession, there will be strains on public finances, since people will lose jobs hence be unable to pay income tax, and will instead draw unemployment benefits. We all accept the principle of helping those out less fortunate than ourselves, I suspect, and I don't need to start drawing out biblical references for that, really. Now, if we look at the actual data, free from any political prejudice, over the last 31 years since 1980, we find a remarkable fact: Given the level of economic contraction in 2008-09, the deficit based simply on the need to pay benefits and the inability to collect taxes, should have been 10% larger than it was! I'm happy to provide the data I used for that (easily available from the OECD also), and tell you more about the methods (simple and standard econometrics) if anyone is interested. It's odd that I'm yet to hear anyone request that.

One good thing to say is that, on my reading, Cranmer has stopped making the false accusation that we pay more in debt interest than we do on health or education. He just now refers to numbers in an attempt to shock us. The most important question with regard the debt interest is: What was done with that money that was borrowed in the past? I'll come back to this.

What is the moral case for debt? Cranmer rather half-heartedly tries to make some theological case regarding debt, attempting to throw some biblical passages in to somehow make it clear that, of course, Jesus would have been at the Rally on Saturday. It's really a rather thinly veiled attempt to attack Labour. So where to start in response to this? Well, if we want to look at Labour's record with the public purse, we only need to look back at that linked blog above that actually looks at real data. The deficit should have been larger, given the size of the recession. That's not mismanagement - at least not in the way Cranmer is suggesting.

Living within one's means and good stewardship, two of Cranmer's central accusations that have some Biblical merit I'm happy to debate, are impossible to prove. How can one prove that the UK is living beyond its means? It is impossible, and as already mentioned the deficit given the size of the downturn should have been greater given the record of all governments since 1980. Is there any indication that the government is struggling to repay the debts it has incurred? Debts, remember, incurred in the main by falls in tax receipts and increases in benefits payments. The answer here is, of course, no.

Of course, the stewardship of God's resources debate. You'd think from the way right wingers blather on about how we're bestowing huge debts on to future generations without anything to show for it - well, are we? Let's think a little bit about it. Paying benefits to keep people from destitution when out of work - why is that poor stewardship? Investing in health and education - again, ensuring these two public services remain up to scratch. Again despite the blather from right wingers, the NHS has improved in the last 14 years on many, many measures (the King's Fund have made this point in many places). Future generations will benefit from this. Poor stewardship?

It is not poor stewardship, and nor is it somehow immoral for governments not to run a balanced budget at all times, especially times when the economy is depressed. Arguably, and I'm not making that point here, it's immoral not to. It's immoral not to pay benefits to people unemployed, immoral to destroy public institutions in the name of deficit reduction, destroy human capital right left and centre in some ideological pursuit of a balanced budget.