The British Conservative government has long argued that deregulation and austerity measures are key to Britain's economic health. According to supply siders David Cameron and his chancellor George Osborne, everyone must go through pain in order to rebalance the economy, including the very wealthy. This is in stark contrast to the Keynesian approach that prescribes a huge jolt of government spending in order to stimulate the economy and replace private sector spending in the short term. Britain is in the middle of an economic experiment where the government has implemented one method over the other, and unfortunately we are seeing the direct proof that the supply side theory doesn't work.
According to a new study from the Institute for Fiscal Studies, the austerity measures will not only continue to depress the economy, but hit the poorest the hardest making inequality even more extreme than before. From the Guardian:
George Osborne's austerity programme will cut the living standards of Britain's families by more than 10% over the next three years as those on the lowest incomes suffer most from the tax increases and spending cuts designed to reduce the budget deficit.
A study from the Institute for Fiscal Studies, the UK's leading experts on the public finances, concludes that the chancellor's strategy will result in greater inequality and rising child poverty, throwing into reverse progress made in the final years of the last Labour government.
This study goes to the root of the deception behind conservative economic policy, uncovering the dirty secret that the Tories have never, and will never be concerned about wealth disparity or structural poverty. Their policies are designed to ensure corporate profits continue to rise regardless (and even at the expense) of the majority of the population. The rhetoric used to soothe the public is as empty as the threats against the banks - token gestures with little intent.
So now maybe it is time to acknowledge the reality and move on from this grossly unfair economic doctrine that continues to harm millions of people around the world.
How much more proof do we need that helping the rich doesn't help the poor, that cutting government services and jobs doesn't boost the economy, and allowing people to spiral in to poverty is not the best way of promoting economic equality?