Saturday, January 29, 2011

The great debt swindle

The Cooking the Books column from the January 2011 issue of the Socialist Standard

Channel 4’s sponsorship of right-wing propaganda masquerading as objective journalism hit a new low in November last year. The storm surrounding the broadcast of the widely condemned Great Global Warming Swindle had barely settled when the channel issued a new swindle, Britain’s Trillion Pound Horror Story, made by the same people. The previous programme was a propaganda offensive on behalf of those who deny (and profit from) climate change. This new programme aimed to achieve a similar victory (for the rich) on the economic front.

That the programme was propaganda and not journalism was signalled to the alert viewer early on when the presenter, Martin Durkin, said he wanted to put the size of Britain’s accumulated debt, £4.8 trillion, into perspective – supposedly the whole point of the documentary. How did he go about achieving this?

Well, firstly, he quite rightly drew attention to the fact that many people struggle to make proper sense of very large numbers (how many zeros are there in a trillion?). A brief explanation and a moment’s thought will end this struggle. But we’d be no nearer understanding. Is four trillion a big number? When compared to the number of digits on our hands or pounds in our bank accounts, well, yes. But when we’re talking about state debt? If so, just how big?

To answer that, it would be necessary to put the number in a comparative context. Is the British debt a big one in comparison to other Western countries? In comparison to GDP? Is it big compared with what it has been historically? Who is the debt owed to and why? How much does it cost to service the debt? What would be the consequences of restructuring or defaulting? Five minutes with Google will turn up the answers to these questions. But Durkin tried a different tack. He put the size of the debt into context by telling us how big a pile of banknotes it would make (helpfully reminding his audience that a banknote is very thin indeed) and how long it would take to chuck the debt out of a window. A puzzling strategy, until you understand that the aim of the programme was not enlightenment, but ideological justification for slashing state spending (most of the debt is made up of future liabilities for the state pension and pensions for public-sector workers).

Durkin’s key, unchallenged dogma was the idea that the private sector creates all the wealth in society, and the public sector is a parasite that damages economic health by sucking up that wealth to line the pockets of pampered bureaucrats. This was smugly presented as an unquestionable truth and used to batter opponents. But it’s rubbish. The truth is that wealth – the totality of a country’s useful things and services – is socially produced by workers in both the public and private sectors. What’s not so obvious is why so much of this wealth flows into a small handful of private pockets in the form of money, some of which then ends up in the state’s coffers.

This is indeed something of a mystery. But it’s not an impenetrable one. Getting to the bottom of it would require the kind of popular documentary we desperately need. But we’d do best not to rely on Martin Durkin ever making it.