Are Cuts Necessary?

Submitted by Tubeworker on 29 July, 2011 - 9:13

Q. Why is the Government making massive cuts in public spending?
A. Because it cares about financial institutions not about ordinary people's needs.
Week to week, governments get cash for their spending by selling bonds to international financial institutions. The ability to sell with a low interest rate for payment depends on the international financial institutions having confidence in government finances.
So these cuts now are all about keeping the banks and international institutions that fund day-to-day government expenditure happy.
There is another reason too. The Tories have always hated public services: they opposed pretty much every move to extend state provision and bring industries - such as the railways - into public ownership, and want everything to be run for profit. They now smell an opportunity to con everyone into believing that cuts are ‘necessary’ so they can pursue their goal of replacing public provision with private profiteering.

Q. So are cuts are an economic necessity?
A. No. They are only 'necessary' if you go along with the economic theory the Tories subscribe to: keep the banks happy at all costs. They are for a 'business-led recovery', which means doing whatever is good for capitalism and to hell with jobs, services and people's lives.

Q. So why make the cuts if they are not necessary?
A. The Tories - supported by their coalition partners, the LibDems - are arguing that the cuts are necessary even though they are not.
This is because they are ideologically opposed to public services, as they serve the interests of private capital and the market instead. They see the current crisis as the perfect pretext to dismantle the welfare state.

Q. Does the government have any other option than to make cuts?
A. Yes, it has plenty of alternatives - or it would have, if it had the political will to avoid cuts.
The government could continue with a large budget deficit for a while. It could cut Trident replacement (about £30 billion) and military spending (£37 billion a year). It could end fat-cat pay to public-sector bosses.
It could stop private-sector fat cats like the companies which have dumped train operating franchises, or the former owners of London Underground's Infracos, walking away from public contracts with loads of money. Private companies which have invested in schools and hospitals are paid back many times over under Private Finance Initiatives (PFIs). These repayments could be cut.
The government could cut the deficit by raising taxes or cutting spending.
It is choosing to lower taxes for the most wealthy (corporation tax - already the lowest in Europe) and cutting public spending.

Q. Will the Government take up these alternatives?
A. No, not unless they fear the consequences.
Nick Clegg has already told us he fears 'Greek-style unrest'. Our unions need to come together for sustained industrial action.We should work with workers in other unions who also face cuts.
Get involved with the local anti-cuts committee in your area. We can build a head of steam to eventually take on the government through national demonstrations and a general strike.

Q. So what do we need instead?
A. We need a workers’ plan for the crisis - a programme of radical action that will tackle the recession in the interests of working-class people.
The box to the right [below] outlines what that Plan might include, with wealth taken from the bankers and big capitalists and spent on the public services that working-class people need.
Ultimately, we need to fight for our own government, a workers' government - a government that stands up for our interests and services, just as the Tory government is doing the bidding of international capital.

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No cuts to jobs and services! The unions should fight to win, not just to protest. For workers' unity across Europe.
Tax the rich! VAT should be cut, not raised. Seize the banks’ huge wealth!
Wages that match the cost of living! Wages, pensions and benefits should be inflation-proofed. No attacks on benefits.
Jobs for all! Share out the work by reducing the working week to 35 hours - cut profits, not pay. Nationalise firms declaring mass lay offs.
Free education for all. Fight the fee increase, scrap fees, no graduate tax - a living grant for every student.
Decent homes for all. Fight the attacks on council housing and Housing Benefit. Mass council house building.
Free the unions. Defend democratic rights. Defy and campaign to abolish the anti-union laws. Defend the right to organise and protest, against police violence and intimidation.
Open the books. Access to company accounts so we can challenge the bosses' version of what is affordable and work out how to solve the crisis on our terms.
Fight racism and its causes. Unless we fight, it will be the far right that reaps the political benefit from the Tory attacks.
Demand that Labour fights. The unions should fight to make Labour pledge to reverse the cuts and scrap the anti-union laws. Demand that Labour councillors refuse to implement the cuts.

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