Chancellor of the Exchequer George Osborne’s Autumn Statement, which lays out the alleged fiscal plans of British Prime Minister David Cameron’s government, has provoked a fair bit of incredulity among commentators.
Never mind the macroeconomics – the plans envisage sharp cuts to public spending that would presumably be devastating in their impact on public services, but with no specifics.
“What the hell is he playing at?” asked the economist Chris Dillow in a recent blog post.
The answer is obvious if you’ve been paying any attention on this side of the Atlantic. Mr. Osborne is playing at being Representative Paul Ryan, the Republican chairman of the House Budget Committee. It’s exactly the same playbook: Claim, often and loudly, that you’re deeply concerned about the deficit, while offering budget proposals whose concrete elements involve savaging aid to the poor and cutting taxes for the rich, which would do little to reduce the deficit (or, in Mr. Ryan’s case, would actually increase it).
Meanwhile, you continue to claim that you’re bringing deficits down, because you pencil in huge spending cuts without any explanation of what they will involve, or how they can take place.
And what’s the goal?
Basically, a war on the welfare state – the implausible spending cuts are only there to snooker the Very Serious People (or what the economist Simon Wren-Lewis, who shares my analysis, calls “mediamacro”) into believing that it’s really about reducing the deficit.
And it works! Even now, Mr. Ryan gets treated with kid gloves by reporters who won’t let go of the story line about the Serious, Honest Conservative.
Mr. Osborne produces a ludicrous budget, and even commentators who acknowledge that it’s ludicrous give him credit for showing “a keen understanding of the constraints facing the country,” as Stephanie Flanders, a market strategist at JPMorgan, recently did in The Financial Times.
Think about that: Someone says that 2+2=5, and gets credit because it shows that he recognizes how hard it is to live within the constraint of 2+2 just equaling 4. Give this man an award!
So, to British commentators puzzled by the combination of hardheartedness, intellectual dishonesty and self-righteousness on display: Welcome to my world.
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