What does ideology mean? Confusingly, it has two connected but distinct meanings. First, it means a structured and coherent set of political ideas. Using this definition we might talk about a Marxist ideology or about ideological Euroscepticism or indeed liberal ideology. We might talk about classic ideological conflicts between Left and Right.
But there's a second sense in which the word is used, which means something like passing off your own political idea as not a political idea at all. Let's call the first sense 'ideology' and the second 'ideology'. In this second sense, ideology is precisely managing to give the impression that you don't have an ideology. Everyone else has an ideology, not me. I'm just speaking plain old-fashioned common sense; I'm accepting the centre ground; I'm just saying what you're thinking.
According to ideology, ideology is a bad word. It suggests dogmatic adherence to a possibly extreme set of ideas; it sounds unpragmatic and inflexible. And this is probably now the main usage of the term ideology; it's what other people have. Tony Blair famously presented himself as a non-ideological politician. David Cameron, as the authors of a recent book have suggested, describes himself and is described as a 'non-ideological, practical, "whatever works" type of politician'. As Terry Eagleton put it, people are unlikely to describe their own ideas as ideological in the same way that one tends not to refer to oneself as 'fatso'. To have an ideology is to deny that you have an ideology.
But this is disingenuous. For two reasons: first, everyone is ideological, a bit. Ideology is not an extreme thing; a commitment to free speech is an ideological position, albeit, in this country, not a very extreme one. Just because you may take your policies from various points on the political spectrum - as Blair and Cameron have both done - doesn't stop you having an ideological framework in which these all make sense; second, ideology is a kind of self-denying mask, behind which may indeed lurk an extreme political attitude. Blair was pretty centrist on many things but beneath the guise of his ordinary-bloke pragmatism he introduced some fairly left-wing things, like the minimum wage. And David Cameron presides over the most economically right-wing government we've ever had. He and Osborne are children of Thatcher. They see themselves as completing her project - and by that I mean, they are trying to do all of the things that even Thatcher thought were too extreme for the 1980s, like demolishing the BBC for instance and privatising the NHS. They are, by action if not conviction, far more right-wing than she was. And yet their political stance presents itself - daringly! astonishingly! - as centrist, as non-ideological.
Nowhere is this more clear than in the current scrap over the Charter for Budget Responsibility. This document was produced a year ago, alongside the Chancellor's autumn statement.
Not many people seem to have bothered to read the Charter but, friends, I went into that jungle and I'm here to tell you what it says:
- It sets out a 'fiscal policy framework'.
- it sets out some bland objectives to 'ensure sustainable public finances' and 'support and improve the effectiveness of monetary policy' *[3.1]
- It says how this will happen - and this involves such extraordinary innovations as
- setting a Budget each year [3.6]
- taking advice from experts (Office of Budgetary Responsibility [OBR]) [3.7]
- indicating targets for the future [3.15]
- It then sets out in a bit more detail how the OBR will operate
And that's it. Also it's pointless, for four reasons:
- The Charter, even if it is adopted into law, can be amended [1.4]. Section 1(4) of the Budget Responsibility and National Audit Act (2011), which brought the Charter into being, says you can amend the Charter, provided that amendments are published in good time and voted on in Parliament. So quite rightly it's not a permanently binding document. Of course it isn't.
- Its rules, even the specific ones set out below, are only deemed to operate 'under normal circumstances' [2.3]. What are 'normal circumstances'? The document does not say and obviously any Chancellor who wants to break these rules will be able to find some evidence of abnormality to justify a change of policy.
- What happens if you miss your targets? You have to explain yourself to Parliament [3.30], just as the Chancellor has to do every year anyway. There are no sanctions, no real consequences to the Charter being breached.
- And while it does say that it needs to listen to the OBR, it also specifically notes that it can also ignore the OBR [3.7].
The Charter is basically a bit of clutter that gets in the way of the already-overcomplicated Treasury process and will no doubt be abolished within a decade or so.
But the bit that's caused all the furore comes in 3.2 & 3.4 which set out these specific aims:
a forward-looking aim to achieve cyclically-adjusted current balance by the end of the third year of the rolling, 5-year forecast period. [3.2]
[a] cap on welfare spending, at a level set out by the Treasury in the most recently published Budget report, over the rolling 5-year forecast period, to ensure that expenditure on welfare is contained within a predetermined ceiling. [3.4]**
Now, first of all, remember the four reasons why this doesn't matter. But, yes, it does seem to try to lock a government into aiming for a balanced budget in the middle of the cycle.
Well that sounds alright doesn't it? Deficits are clearly bad things. We need to live within our means! We need to balance the books!
Have you got an overdraft? Ever used it because you know you've got money coming in soon but need to spend money now?*** Yes, you have, cos that's what an overdraft is. And what you are doing there is running a deficit. Let's assume you're spending this money on fairly respectable things like shoes and food; you might well say you are investing in yourself to make you more able to earn more later on. In such circumstances, you are wisely going into deficit. So deficits are often perfectly fine.****
If the Government builds a bunch of hospitals, it may well go into deficit for a bit. But building a hospital has two great benefits: (a) the long-term benefit of being able to treat more sick people and make them better (which is good in itself but also releases them back into the economy) and (b) the medium-term benefit of giving salaries to hospital-builders who then spend their money, putting it into the economy to do more work and stimulate growth. It's a good thing to do in a recession, because it gets people off the dole (reducing government expenditure but also raising morale, improving health, etc.) and stimulates the economy. If you cut during a recession, you would expect to see the opposite: unemployment rising, low morale (hence things like riots), blossoming NHS waiting times, and low growth.
(Now where have I heard of that happening...?)
But this Charter is sort of trying to stop governments investing. This is because of the ideological commitment of the Chancellor to small government, even if it wrecks the economy (and, let us remember, we are precariously climbing out of recession, but its the slowest exit from a recession in recorded history).
But the key thing is the title: The Charter for Budget Responsibility. The title is what this whole stupid saga is about. It's all part of an ideological move to redescribe conservative economic ideology as nothing more than 'budgetary responsibility'. Who's in favour of budgetary irresponsibility? No one.***** It's redescribing the objectionable as the unobjectionable. It's the very definition of ideology.
And of course, because it's a George Osborne idea, it's nothing to do with running the country, it's a trap for the Labour Party. If they support budgetary responsibility they tie their hands and commit themselves to Tory policies. If they oppose it, they look like 'deficit deniers' (another wholly ideological phrase). It's the legal continuation of everything the Tories have said about Labour since 2010: that Labour can't be trusted on the economy because the huge national debt was run up by excessive welfare spending, which is such an obvious falsehood, I genuinely admire Tories who can make the claim without blushing.******
Labour have fallen into this trap a bit. So powerful has the Tory line about Labour and the economy that even a dyed-in-the-wool Keynesian like John McDonnell, thoroughly opposed to Osborne economics, made it his duty at the Labour Conference to come across as a boring, respectable, bank manager type and declared 'we accept we are going to have to live within our means' and that he would be supporting the Charter for Budgetary Responsibility. In the fortnight since then, he seems to have realised this is absurd and so, at a stormy meeting of the Parliamentary Labour Party, he yesterday announced a reversal of policy.
Well, he could have managed that a bit better, but ultimately, of course, Labour should oppose it. How can the Labour Party sign up to something that is basically a declaration in favour of Tory economic policy? This is exactly the idiocy that had Labour MPs whipped into abstaining on the introduction of £12bn in welfare cuts this July, on the basis that it would make Labour look more fiscally responsible. No. Supporting Tory policies like this makes them look like they have no principles except the desire to get into power. Who wants to vote for that? It's quite right that Labour see this Charter for what it is: ideological warfare and nothing less.
The problem is that 'budgetary responsibility' means nothing without an ideology to support it. Osborn would like us all to think that welfare and investment are bad for the economy and this is his way of getting us to think that way. But it's not true. Welfare and investment are not bad for this economy. Its this economy that's bad for us.
NOTES (NOTES! ON A BLOG! MADNESS!)
* These are actually weasel words; specifying that 'the effectiveness of monetary policy' is a core aim is cheeky because, in this context, it reflects a view, prevalent on the right since the early 80s, that the best way of running a stable economy is simply by adjusting the money supply (that's what monetary policy is) and not through public investment, so it's implicitly marginalising public investment.
Or, as John McDonnell has taken to calling it, 'people's quantitative easing' which is quite clever because 'quantitative easing' is an instrument of monetary policy (increasing the money supply). By rebranding public investment (building schools, hospitals, motorways, etc.) 'people's quantitative easing' McDonnell is trying to make a stimulus policy look like monetary policy, though it kind of doesn't work because people who don't know what quantitative easing means, don't get it, and people who do, see through it.
** Also, let's note that [3.25] the Government can annually adjust what it is including in its definition of Welfare. It's like me saying I have a predetermined cap of FIVE 'bezzie mates' and, if I make a new great friend, I can just demote someone else.
*** Having said that, comparisons between government and personal finances are always bullshit. I don't get tax income, governments do; I can't print money, governments can; my expenditure doesn't go up when people become sick or unemployed, government expenditure does.
**** A note just to clarify the difference between a debt and a deficit. With apologies to the note above, if I get a mortgage, I have taken on a debt. If I can make my regular mortgage payments, I'm fine. But if I fail to make those payments, I am in deficit. Debt is not a bad thing; most people could never buy a car or a house or go to university without it. Deficit is only a bad thing if you can into a spiral, as in the people who take out a pay-day loan to make a mortgage payment and then they can't pay off the payday loan and the situation just gets out of control. A Government like ours really is never going to get into that kind of spiral. Over the last 60 years, UK annual growth has averaged 2.48% which means that both deficits and debts have tended to diminish over time.
***** Okay, me, at the beginning of the month.
****** It's straight out of the Tony Blair playbook. If you remember, for a generation, the Tories had a terrible reputation on the economy, because of Black Wednesday, when sterling was bounced out of the ERM. New Labour pounced on this because they knew it was a once-in-a-lifetime chance to challenge the Tories on the economy. And, look, I dislike the Tories as much as anyone, but actually coming out of the ERM was pretty swiftly rather good for the UK economy. Yet the mud stuck.