The PM's speech sets the scene for the measures required to cut the country's "massive deficit and growing debt." A deficit that equates to £22,000 for each of us...in 5 years time. In other words, if it, i.e. the deficit, is to double in 5 years as claimed, our personal load is therefore currently at £10,000. Clearly, a worrying figure, but less headline grabbing than one double that size.
Anyway, that's a diversion from the real issues the speech raises.
We all know of the still recent madness perpetrated by the banks, and the PM calls this, "the success of financial services was partly an illusion, conjured from years of low interest rates (sounding critical, though surely low rates are better than the Lawson/Lamont era's 15% APR?) cheap money and a bubble in the price of assets like houses."
The analysis then switches to attack the "boom in government spending", which is seen as being of a longer term and deeper nature than the episodic credit crunch (not mentioned by name), i.e. public spending is the problem, not the hundreds of billions used and borrowed to stabilise (i.e. and buy) the banks. For example, in one afternoon in 2008 the government gave a single bank, RBS, more than had been saved by all of local government in the three years of the previous CSR. And, in the following weeks gave to that and other banks, everything that the whole of the public sector had saved in the previous CSR three-year period, i.e. £60billion. So, whilst spending in the public sector had increased in the previous decade, there had been real savings also. It also worth reminding ourselves that in the Government's emergency announcement at the end of May, £6b in savings were demanded from the public sector, i.e. a tenth of that previously saved in the aforementioned CSR period. So, the public sector can do it, has done it before, and is clearly going have to do it all over again!
Even that though is not the key issue. The speech goes onto say, "boom did turn to bust" and "the problem we face today is not just the size of the debts but the nature of them" and "how recklessly they spent the money", "shining a spotlight on waste", and this is where we see the polemic alter from poor financial industry practices and government mismanagement to the developing narrative that is now firmly bonding 'public sector' with 'waste'.
So, we now have the family that gets "£93,000 in Housing Benefit every year." How many of those are there? An "almost doubled number of managers in the NHS", which per se might not be a bad thing for all I know, but certainly is seen as such, regardless of their input/output/outcomes. Ministry of Defence overruns; can't argue with the apparent ineptitude there, and "£4.5b over budget" sounds serious to me, but on a budget of what, say several tens/hundreds of billions, is that a hanging offence? Perhaps so. And so on, a "public sector whose productivity is falling", a previous government "hostile to a private sector" and "public sector continuing its inexorable expansion." It's best summarised in these paragraphs:
"While everyday life was incredibly tough for people who didn't work in the public sector with job losses, pay cuts, reduced working and falling profits for those in the public sector, life went on much as before."..."So while the people employed by the taxpayer were insulated from the harsh realities of the recession everyone else in the economy was paying the price."... "And now we're all paying the price because the public sector has got way out of step with the size of the private sector."... " We're going to have to get it back in line - and that will be more painful than if we had kept things properly in balance all along."
The analysis might indeed be correct, if skewed towards blame and scapegoating of a single sector, one in which I wonder if the PM includes the oft eulogised nurses, police and armed forces in this polemic, or just the public 'administrators'?
The PM concludes his analysis by saying the "unavoidable" cutbacks "could have been avoided if the previous government had spent wisely instead of showering the public sector with cash at a time when everyone else in the country was tightening their belts."
So, there it is, one line on the debt burden created by banking madness and the majority of the speech on the waste of the public sector. The PM promises "immediate and decisive action", "unavoidably tough", though "in a way that strengthens and unites the country" - unless you're in the public sector? Well, no, because we also read that "this government will not cut this deficit in a way that hurts those we most need to help that divides the country or that undermines the spirit and ethos of our public services".
The task of avoiding hurting "those we most need to help" must be applauded, and then held to the highest level of account and scrutiny - assuming of course we are all talking about the same people who we most need to help!
