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James Delingpole

Spending isn’t the answer. But how do we explain that?

2 March 2013

9:00 AM

2 March 2013

9:00 AM

One of the things I love about being a classical liberal is that I’m always on the right side of every argument. I’m pro: freedom, jobs, self-determination, cheap energy, higher living standards, academic excellence, property rights, an even better future, Michael Gove MP, wine, women, song. (So long as the song is not by Maroon 5 or Bruno Mars.)

And I’m anti: arbitrary authority, nanny-statism, money-printing, tyranny, despair, almost all war, poverty, prohibition, disease, squalor, uncleaned-up dog poo, meddling busybodies, crap capital projects based on massive lies (that means you HS2!), corrupt officials, civil war, totalitarianism, hyperinflation, injustice, Tim Yeo MP.

Yet you’d scarcely guess this to read some of the things they say about me on the internet. If you go to Urban Dictionary, for example, and look up ‘Delingpole’ you’ll find these definitions. 1. ‘A stubbornly deluded idiot, one who refuses to acknowledge their errors.’ 2. ‘An individual suffering from delusions of intellectual adequacy.’ Gosh: what exactly is it about my agenda of peace, abundance and liberty that these people find so objectionable?

Well, of course, they almost never say. It’s one of my great frustrations on those rare occasions when I catch sight of the troll comments below my articles: ‘Yes, all right, I know I’ve got horrid, crooked teeth and I’m hideously emaciated like I’ve got Aids and I’m thick and arrogant and wrongheaded and it’s an absolute disgrace that a serious newspaper is paying me to write this rubbish,’ I mutter to myself (in my reedy, whiny, faux-posh, hateful voice). ‘But what exactly is your reason for discounting the argument I’ve just advanced?’

There’s only one plausible one, as far as I can see. I’m not saying I buy it — but superficially it does make a lot of sense. Indeed, I’d argue it represents the single biggest intellectual challenge to conservatives across the world right now: just how do you make the case that government spending, far from being a job-creating, economy-boosting thing, is in fact the bitter enemy of both?


It’s hard because it’s counter-intuitive. Say to almost anyone — not just on the left, but ordinary, politically apathetic people like my lawyer friend John with whom I nearly had a serious falling out on this very issue last weekend — that a drastic reduction in government spending is vital to our recovery and they’ll look at you like you’re mad.

If government cuts spending, that means people in the public sector will lose their jobs. Not only will this drive up unemployment but it will also stop the virtuous cycle whereby all those public sector workers spend their money on goods and services, thus creating the demand which gives jobs to other people, thereby enabling them to spend their money on still more goods and services, and so on.

As I say, I don’t buy it, but it’s a hard one to counter without getting bogged down in theory. To me, it’s a given that whenever the state gets involved in the economic process, it automatically leads to misallocation of resources because no government bureaucrat can ever respond to consumers’ needs with the sensitivity, alacrity and accuracy of the free market. But not everyone out there shares my faith in Hayek and von Mises.

Next step is to try to persuade them using examples from history. You can note, for example, that during the Soviet Union, hundreds of thousands of bureaucrats had the job of deciding what the next few years’ production schedule was going to be in this or that commodity. Or you can note the relative economic performances of heavily regulated, relatively high tax and socialised economies like Europe’s and of more free market, low-tax economies like Hong Kong’s and -Singapore’s.

You’d be amazed though by how many people out there think that history is something that happened in another time and another place in a universe of no relevance to the here and now. ‘Yeah but you haven’t really explained where all these jobs are going to come from if the government slashes spending,’ they go. ‘And instead of having people in work, all you’ll get is people on unemployment benefit.’

Yup, it’s a tricky one. Sufficiently tricky to have dissuaded any senior member of the current coalition from even attempting to try explaining it to the electorate. Which of course is why we’re in the mess we’re in: we’ve lost our AAA credit rating not, as cynical opportunists like Chuka Umunna would have it, because Osborne’s cuts have been too hard and too deep but because, as the markets have twigged, they’ve been -nonexistent.

Over at www.bogpaper.com, I’m inviting people to take part in a prize competition, the winner being whoever can explain, in terms readily comprehensible even to an audience brainwashed by the BBC’s crack team of neo-Keynesian ideologues, why it is that government spending is not the solution to our ills but the cause of them. It’s something Osborne should have done long ago; indeed it was the sort of thing he used to talk about quite a lot in those heady months before he found himself in government and decided to wuss out.

Future historians are not going to look kindly on our political class’s moral and intellectual cowardice in the midst of the deepest, most intractable economic crisis ever. The patient has near-terminal cancer but none of the doctors dares tell him lest he gets frightened by scary words like ‘chemotherapy’, ‘radiotherapy’ and ‘surgery’ and rejects the radical treatment he needs. Meanwhile, the cancer is spreading and with each day the chances of a happy resolution grow smaller and smaller. Can it really be that Drs Cameron, Osborne and the rest of their team would prefer the patient to die in ignorance than offer him the means to a full recovery?


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