Saturday, 1 September 2012

Political OCD: is there a cure?

In politics, those afflicted with Obsessive Cuts Disorder cannot distinguish between what should be cut back and what should be increased at different times to ensure society as a whole can thrive. All they think about is repetitively cutting taxes for the wealthy minority and cutting public support which would hurt the not-so-well-off majority.

Political OCD tends to affect the extreme right side of the brain. The most common symptom is blindness to evidence, often accompanied by a crushing anxiety that can only be eased through intensive draining of resources from the poor to the rich. If it is not swiftly dealt with, it will lead to severe depression. One of the best known examples concerns a succession of political OCD American Presidents who through the 1920s and early 1930s choked demand so excessively that it brought on what is clinically termed the Great Depression. The masses were deprived of a decent income to spend on anything much, while the rich either hoarded their money or blew it away on speculative bubbles. It rapidly pushed the entire world to the brink of collapse.

On that occasion, it was the careful injection of public investment into the economy, such as the New Deal in the US and the Welfare State policy in the UK, which eventually restored the health of those countries. Unfortunately, individuals prone to political OCD often succumb to prolonged memory loss.

In 2010 when the irresponsible actions of the under-regulated banking sector had left us in the most unenviable state, politicians were split as to what should be done. Those who remembered the past, like the then Labour Chancellor, Alistair Darling, suggested a phased approach to spending cuts, backed by higher taxes for the richest to help fund public investment to stimulate the economy. Under those policies, the British economy began to grow again. But Conservatives like George Osborne, gripped by Obsessive Cuts Disorder, insisted there must be rapid and radical cuts to public spending, while the tax rate for the richest 1% must also be cut as well.

More than 60 of the most eminent economists (Nobel Laureates amongst them) backed the more balanced approach favoured by Darling (see The Financial Times, 10 February 2010: Osborne ignored them on the basis that he could find 20 other economists who would support his approach, and having won the 2010 elections, embarked on his relentless cuts. But over two years later, growth has completely vanished in what is now a shrinking economy, and of those 20 economists Osborne claimed to be on his side, just 3 still stand by their original assessment (The Telegraph, 19 August 2012:

So will Osborne change course and adopt a more measured approach? Cut taxes like VAT to help the majority, but not cut elite taxes which only help the wealthiest? Cut waste by all means, but invest in public services that will boost confidence and demand? The signs are not good. And distressingly, despite all the problems caused by his Obsessive Cuts Disorder, some Tory backbenchers actually want to see Osborne’s troubling condition get even more out of control. And over in America, the Romney and Ryan team appears to have learnt nothing from their own country’s history or Britain’s current experience, and promises an unmitigated outbreak of political OCD as the future for America.

Once they are in power, those with political OCD will remorselessly cut until there is nothing left but a tiny oasis of wealth in the middle of a desert of desolation and unemployment. Ultimately, the only cure is in the ballot box.