I just posted the following as a thread on Twitter, hence the way in which is is divided. The message is as stark whereve3r and however it is read:
Before our government chose to become a pariah state, and before it was clear it planned to fail on coronavirus testing I expected UK unemployment to exceed five million next year. But now it may be very much worse. And I beginning to fear that is exactly what the government wants.
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We find it very hard to comprehend a government that chooses to create unemployment. But remember Thatcher did just that. She created unemployment to destroy unions and manufacturing so she could create a different type of society. Is Cummings now planning something similar?
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Could it be that this government wants staggering levels of unemployment as its excuse to take on all the instruments of power that it hates: Parliament, judges, civil society and democracy itself? Do they really think that catastrophe will let them reshape the UK forever?
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If you wanted to create massive unemployment could you do better than end free trade, crush our export focussed industries, deny our service sector access to the EU and stoke inflation all at the same that Covid 19 brings the SME sector to its knees? I doubt it.
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So why would you want that mass unemployment? Could it be to create the despair that might provide the support for your extremist crack down on all the liberties that once underpinned life in the UK? Can you think of any better way of generating that support?
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But I foresee a problem with this plan. I have little doubt that Cummings thinks he can keep control during the chaos he is seeking to create. So did those who created the French Revolution, and within months many of them had lost their heads,and I don't want that for anyone.
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The problem for Cummings is he may believe forecasts suggesting we're heading for 3 million unemployed, and he imagines 4 or so million achieving his aim. But I already expected 5 million unemployed and expect many more now, plus mass corporate insolvency and a banking crisis.
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Cummings wants chaos and despair to get what he wants. But No Deal plus Covid create the potential for total economic meltdown and simultaneous substantial inflation in the UK now which MMT cannot solve. We will be a failed state politically and economically in that case.
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For Cummings' plan for the transition to the state he wants to work he has to maintain the appearance of a functioning state whilst subverting the purpose of every agency within it. This is how fascist takeover happens. But this continued functioning may not happen.
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Massive unemployment - 6 million plus - means a catastrophic failure in demand and economic meltdown whilst the state pumps in millions in benefits payments which even so people may not be able to spend because goods will not be available to buy. Serious inflation could result.
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At the same time No Deal Brexit will be trashing the value of the pound. This may be a previously unforeseeable double whammy that could break the UK economy. Britain will still pays its debts. But more importantly it may not be able to feed people.
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There are three ways around this. One is abandoning No Deal. The second is making Covid testing work. The third would have to be a massive state backed work programme - beyond anything likely to be deliverable in the time required. Job Guarantees can work, but I doubt this fast.
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I cannot see Cummings opting for any of the options that can save us from economic meltdown. He wants no deal. He wants herd immunity. And he wants unemployment. So we face catastrophe.
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I suspect Cummings thinks he can maintain economic order by balancing the pound, unemployment, spending and QE. And without No Deal maybe we could. With it and a (likely) significant second spike his chances are remote. QE in this scenario tips us into chaos.
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The result of the chaos is hard to imagine. But we've never seen a self imposed economic breakdown of the type our government is now choosing before so it's really beyond the boundaries of extrapolation. What will survive it and how is hard to imagine. That's its scale.
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What are the odds of this chaos happening if we go for No Deal and have a Covid spike? I'd suggest they are very high indeed. I'd rate the chance of managing the economy in 2021 as very low in that situation. I expect the UK to be a completely broken nation as a result of it.
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This can, of course, be avoided. Continued state support for business and employment is possible now. No Deal can be abandoned. Covid could be managed. We could become a willing partner of other states. We need not face turmoil. It will be a choice.
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But, might this nightmare scenario that I think Cummings wants, without appreciating how bad it might be, play out? I think it might. And because I can now see that scenario developing I think it needs to be on the agenda for discussion. We have to know the risks we face.
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If you thought things were bad, I suggest you think they could be much worse. That's the only way to embrace the possibilities that deliberately provoked economic meltdown might create and to plan for managing them.
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On your bio, you state that you write a “regular” column on AccountingWeb.
Could you define “regular”? It’s been months since they published anything by you.
Because I have chosen nit to write anything
So shouldn’t you update your bio?
To be honest with your readers?
You really think that a big issue
I could resume whenever I wish…
Cummings has failed to factor in that the UK is far from being a self-sustaining economy. Indeed he fails to recognise how much the UK is reliant on “the kindness of strangers,” foreign owned businesses investing here to export or service the vast EU market. Indeed I don’t think any Tory politicians really understand markets from a global and moral perspective it’s all about making money and the devil take the hindmost!
https://www.nybooks.com/daily/2016/10/18/brexit-death-of-british-business/
Cumming’s latest plan to achieve zero tariffs for mainland UK commodities goods by breaching the Withdrawal Agreement and combining it with wholesale government subsidies for these items to push them across the Northern Ireland border into the vast EU market is so blatantly transparent even a child can figure it out!
The American Congress and the EU are rightly about to show Cummings he’s far from the genius he thinks he is!
Classic example of Tory government failing to understand that global trading always requires some measure of giving up sovereignty to achieve harmonisation on standards (and especially after Mad Cow Disease!):-
https://www.huffingtonpost.co.uk/entry/brexit-barnier-frost-negotiations-twitter_uk_5f5e1d28c5b62874bc1e4a1c
Totally agree. I hope this isn’t a stupid observation but somebody (or some body) is controlling Cummings, even if he is too vain to realise it. Is identifying who pulls his strings the first hurdle to cross in the path of sorting this out? Apologies if I’ve missed the point and feel free to ignore this comment.
What we don’t know is whether Cummings has hidden Russian links like Trump:-
https://www.theguardian.com/us-news/2020/sep/13/trump-compromised-by-russians-peter-strzok-former-member-mueller-team
I think Cummings is inspired and motivated by the likes of Steve Bannon, chaos, disorder and confusion are good.
I agree with the motives you speak of.
But where the likes of Cummings, Johnson and the Rees-Moggs will go wrong is that they still have no idea how many people live their lives in this austerity addled country.
They live in bubbles of wealth and affluence (in Cummings case OTOH I think its ‘effluence’ ) and I think their detachment/de-coupling from real life will lead to them seriously underestimating the impact this will have – and the forces it may unleash.
There is a chance that they will be swept away by this too, and our job and HM opposition is to make sure that that when the waters subside, democracy and fairness are left standing.
There is a handy software bot that will do the job of arranging your tweet threads into one page for you https://threadreaderapp.com
It does, I know
But I don’t always post as threads as they are not read nearly as much as individual posts
“This is a crisis like no other”, Deflation and private debt are the possible problems not Gov debt. This podcast with Steve Keen raises some interesting issues.
https://www.toptradersunplugged.com/steve-keen-global-macro-series-10th-september-2020/
I agree
All risks but those of old are on the table
You would think that with a situation like that occurring the government would fail or be extremely unpopular. You couldn’t be more wrong. There is a large minority, 30% – 40% who are baying from the sidelines ‘..you show them Boris..’ when he threatens to break international law. Every time the Home Secretary tightens the screw on immigrants/asylum seekers the same crowd scream support. You only have to walk past a newsstand and glance at the large print banners to see the goading of ‘snowflakes’ and ‘woke folk’ who raise objections. This brings me to another point: Not that I ever watch, but the newspaper reviews on TV show these same headlines and set the tone of any debate. In fact, they love seeing people get angry and in despair over the state of affairs, it is just like rival football supporters.
Some of your contributors say why worry, the sun is shining, coffee at the pavement cafe and what’s the fuss?
When the inevitable hits the fan, you can be sure it will all be the fault of those dastardly Europeans/remoaners/{anything-you-hate}/not getting behind the winners, talking down the government and so on.
The net result of this is that there will not be a majority of the population able to bring change as they/we are not in a cohesive group. I also have no idea what is going on in the opposition’s minds either! But in general, your previous predictions have proven correct more times than not.
First a compliment — as someone who occasionally drops in to your site for my own education, thank you so much for putting your thoughts in regular print in order, even if rather staccato in the way it is broken up. I for one don’t have the patience to work through multiple twitter frames in reverse order, or waste 5 minutes on a video to find out whether it was something I was interested in.
But as a comment — I think you are falling into the same trap as the far right in looking for a conspiracy. To be honest, I think it is just that they don’t really care, it is all about them. As you point out Thatcher didn’t care about unemployment either, but that was her failure, the fact that she left the economy unbalanced in a way that still leaves the UK more vulnerable than anywhere else when there are external factors causing a downturn was simply a matter of not caring about consequences. Johnson seems to be the same but for different reasons.
While it is true as far as the average citizen can tell that Cummings is not an asset to the country, I doubt that he is some evil mastermind. His influence is probably simply because “in the land of the blind the one-eyed man is king” — there is no one else with any intelligence in a position of influence, nor anyone who recognises that intelligence without a leavening of humanity is dangerous. Johnson et al simply lack ideas of their own.
My apologies for a sense of despair.
I wish I could share your feeling
I sense a plan that could go horribly wrong
I used to take the view that stupidity is always more likely than malice as there is a lot more stupidity than malice.
However with this government I am now switching undecided on the bases iat even a broken clock….
More bluntly: I find it hard to believe in such a consistent level of stupidity.
But….. Brexit!!!!
[…] would have thought the risk of such accidents was so negligible as to be completely worth ignoring, but I now think complete UK economic meltdown is a possibility given the now apparent combination of this government, its disaster driven economic policies, its […]
Surely for this to play out, huge numbers of individuals in the civil service and wider Tory party will need to be complicit in this to allow it to happen? I still have a (perhaps) vain hope that there are some good people there who simply won’t let this happen. Unless this is too far gone already?
And if they fear for their jobs? That’s how control is imposed
I lived through the 80s and mass unemployment. No jobs were there, when I left school it was life on the dole for me for a very very long time. It was for the same of my generation but my lot voted maggie 3x times and they vote in Johnson as well. Yep, my generation who suffered mass unemployment deliberately caused by the tories votes them and they love them. The tories say the right words, press the right buttons and they get election win after win.
They hope to throw democracy under the concrete bus, in their view it has not worked. Look at Sturgeon the tartan tory egging the UK state to take them on. Guess what it looks like Bojo is about to just that, and the first shot was the internal market bill. Then mass unemployment and the votes will come in the millions for the tories – so they hope. Scotland will have to sing for their referendum, as their parliament will be eviscerated of power, so will the welsh and the Northern Ireland Assemblies.
To the tories, esp Cummings and Co democracy is mob rule and they need to put in back in the box, either underground or with mass unemployment. It is clear they want a unitary state, a state-controlled by number 10 and no parliament shall stand in their way. Brexit and COVID 19 is a boom for these people, a perfect storm to get people to vote for their own deaths and misery of Universal Credit. I said after Corbyn lost last December we are “F****Ked and we are, but not Johnson and Co. They have a Cumming plan.