11 of the biggest lies you’ll hear this election season

1. Labour created the deficit by borrowing and spending too much

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Nigel Farage: “Look, there’s no question that spending got completely out of control under Labour” (00:21:21)

David Cameron: “The Choice at this election is sticking with a plan that’s working – or going back to the debt, taxes, borrowing and spending that got us in this mess in the first place.” (00:06:10)

“if we go back to the tax, the waste, the spending and the debt, all the things that got us into a mess in the first place, we wouldn’t help working people; we’d hurt working people. That’s what Labour did last time, and we mustn’t let it happen again.” (00:11:55)

“Here’s the point, we’ve got to understand why the deficit matters and why we got here. And the problem and the real choice is with Ed Miliband, who still thinks the last Labour government didn’t tax too much, borrow too much and spend too much. And if you don’t understand the mistakes of the past, you can’t provide the leadership for the future.” (18:03)

“We won’t do it if we go back to the debt, the welfare, the spending and the taxes that got us into this mess in the first place.” (00:25:40) 

Reality: In 2008, there was effectively no deficit. The financial crisis created it, by pushing up government spending and reducing its income.

Evidence:

Bank of England (via Simon Wren-Lewis and Charlie Cooper; New Economics Foundation):

“In the final years before the recession, [public spending] tightened, so that just before the onset of the recession the deficit was very small. This is hardly the story of a profligate government creating a crisis.”

“Once the recession began, the budget deficit rose rapidly. It did so for two reasons. First, government expenditure automatically rises when there is a downturn. This is because in a downturn tax receipts tend to fall, while government spending on items like unemployment benefit tends to rise. Exactly the same thing happened to most governments over this period. Second, the Labour government, like the Obama administration in the US, implemented temporary tax cuts and spending increases to help offset the impact of the recession. Both factors were a result of the recession, and not the cause of it.”

 

2. We have to slash public spending

Nick Clegg: “There was no money left.” (01:27:10)

“The difference between David Cameron and myself is: I believe you need to make the necessary cuts because you have to. George Osborne and David Cameron make much further cuts than is needed because they want to. And that’s a huge difference.” (00:30:35)

Reality: Austerity is not a necessity. It is a choice – and a highly damaging choice.

Evidence:

Nick Clegg, May 2010:

“My eight-year-old ought to be able to work this out – you shouldn’t start slamming on the brakes [on public spending] when the economy is barely growing. If you do that you create more joblessness, you create heavier costs on the state, the deficit goes up even further and the pain with dealing with it is even greater. So it is completely irrational.”

 

3. Government debt is a burden on future generations

Nick Clegg: “to increase borrowing – that doesn’t help the future generation either.” (00:21:21)

“the only way we’re going to instil optimism is if we wipe the slate clean for the next generation. We have to release Rebekah and her generation of the debt and the deficit of this generation. I don’t want Rebekah, I don’t want my own kids, I don’t want any of our children to pay the price for this generation’s mistakes. And if I can leave Rebecca and everybody with just one figure in mind, one statistic – £46 billion, that is what we as a country will spend next year just paying off the interest on our debts. Just imagine the number, the hundreds of thousands of homes we could build for £46 billion. £46 billion is the same as £700 for every man, woman or child in this country. And that is why when I hear some leaders implying that we shouldn’t somehow get rid of our deficits, I say look, if you don’t do that, it is a bit like Miriam and me saying we’re not going to pay off our credit card bill and we’ll get our little kids to pay it for us. It’s not fair, we must let the future generation be released from this generation’s mistakes.” (1:43:06)

Reality: If there are debtors and creditors in this generation, there will be debtors and creditors in future generations. The money does not disappear; it changes hands. So government debt is a question of distribution, not the “burden” on future generations.

Evidence:

Paul Krugman (Nobel laureate in economics):

“… a debt inherited from the past is, in effect, simply a rule requiring that one group of people — the people who didn’t inherit bonds from their parents — make a transfer to another group, the people who did. It has distributional effects, but it does not in any direct sense make the country poorer.

 

4. Government debt risks jobs and the economy

Nick Clegg: “I’ll never let anyone else borrow money that we don’t have and jeopardize your, risk your jobs and our economy.” (00:04:04)

Reality: Cutting back spending as Clegg has done spending jeopardises your jobs and our economy.

Evidence:

Paul Krugman, Nobel Laureate in Economics:

“All this austerity has, however, only made things worse — and predictably so, because demands that everyone tighten their belts were based on a misunderstanding of the role debt plays in the economy. … Because debt is money we owe to ourselves, it does not directly make the economy poorer (and paying it off doesn’t make us richer).”

 

5. The coalition has rescued the economy

David Cameron: “For the last five years, we’ve been working with the British people through a long-term economic plan. And that plan is working.” (00:06:10)

“We’ve been talking about the difficult decisions we had to make to turn the economy around.” (00:35:26)

Reality: The coalition’s economic policy has damaged the economy.

Evidence:

Robert Skidelsky, Emeritus Professor of Political Economy, University of Warwick:

“The Conservatives claim that ‘by halving the deficit we have restored confidence to the economy’. This cheerfully ignores the near academic consensus that their deficit-reduction policies over the last 5 years have made the British economy between 5 and 10% smaller than it would have been with more sensible policies.”

Martin Wolf, Financial Times Lead Economic Commentator:

“Austerity has failed. It turned a nascent recovery into stagnation. That imposes huge and unnecessary costs, not just in the short run, but also in the long term: the costs of investments unmade, of businesses not started, of skills atrophied, and of hopes destroyed.” (New York Review of Books, July 2013)

“The government made three arguments for accelerated austerity. None was persuasive”

“George Osborne, chancellor of the exchequer, argued in his Budget speech: “The critical choice facing the country now is this — do we return to the chaos of the past?” Moreover, he insisted: “We set out a plan. That plan is working. Britain is walking tall again.” The questions are: is the underlying analysis persuasive; and, if not, does it lead to a misleading perspective on challenges ahead? My answers are “no” and “yes”.”

“It has also become clearer that the crisis both revealed and caused structural weaknesses that the government has neither recognised nor addressed. What are they? Simply, the economy is “ex-growth” — underlying growth has stopped. Against that background, the aim enunciated by the chancellor “for Britain to become the most prosperous major economy in the world” is absurd … real gross domestic product per head at the end of 2014 was much the same as at the end of 2006; real GDP per head at the end of 2014 was about 16 per cent below what it would have been if pre-crisis trends had continued; and GDP per hour was about 15 per cent below the pre-crisis trend.” (Financial Times, March 2015)

 

6. Growth figures prove the coalition’s “economic plan” is working

David Cameron: “And the plan’s working because last year we had the fastest-growing economy of any of the major western countries.” (00:06:10)

Reality: Britain’s “recovery” is founded on a falling oil price – which has nothing to do with government policy – and soaring personal debt, which is likely to cause another crash.

Evidence:

Ernst & Young Independent Treasury Economic Model (via London Loves Business):

“Britain is benefitting from tumbling oil prices … As oil prices have fallen, consumers have been left with more disposable income and the [forecaster] now expects to see a rise in GDP of 2.9%, up from previous estimates of 2.4%.”

Office for Budget Responsibility (via Financial Times):

“[The OBR notes] a very small rise in short-term growth forecasts to reflect the beneficial impact of cheaper oil on household spending. …

“However, this is a tiny boon compared to the extent of the productivity crisis which continues to beset the British economy. …

“The OBR also flagged the re-emergence of two historic weaknesses in the British economy: a persistent external deficit and a reliance on household debt.

“… household debt is still set to rise to 171 per cent of national income by 2019, which is higher [than] the pre-crisis peak of 168 per cent in 2008. …

““This would be a highly undesirable outcome,” said Tony Dolphin, chief economist at IPPR. “Households could have more debt, relative to income, by the end of the decade than they had when the financial crisis hit.”

“Britain may be the “comeback country”, but for how long?”

 

7. The government has created 2 million new jobs

David Cameron: “There are almost two million more people in work.” (00:06:10)

“We are going to keep on with this reduction in unemployment that sees two million more people in work.” (00:25:40)

“We’ve created 2 million jobs cos we’ve got a strong and growing economy” (1:15:37)

“Obviously in the last Parliament, we’ve created 2 million new jobs.” (1:24:59)

“We’ve created 2 million jobs” (1:51:58)

Reality: Cameron’s definition of “jobs” includes low-hours work, temp jobs, zero-hours contracts and “self-unemployment”: formal self-employment that masks real unemployment.

Institute of Employment Rights:

“falling unemployment figures masks the more sinister reality of the new jobs market; casualisation, underemployment, zero hours contracts and bogus self-employment. … Underemployment – those in work but wanting more hours – now stands at 3.2 million, almost one million more than it was in 2008.”

 

8. The coalition has “invested” and put “extra resources” in the NHS

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David Cameron: “We’ve invested in our NHS …” (00:06:10)

“We’ve invested in our national health service.” (1:51:58)

“We’re going to go on investing in the NHS every year, as we have done under this government, under the last Parliament.” (00:11:55)

“What we’ve had is a balanced plan – it’s put more money into the NHS” (00:30:35)

“a difficult decision we made also was to go on funding the NHS, putting more money in every year.” (00:35:26)

“We went ahead and invested in our NHS as part of a balanced plan for our country.” (00:54:48)

“Now all of this has taken the extra resources we put into the NHS.” (00:54:48)

Reality: The coalition have cut the rate of investment in the NHS to the bone, while spending hundreds of millions on a costly privatisation. NHS spending as a proportion of GDP has fallen.

Evidence:

Andrew Dilnot, Chair of the UK Statistics Authority (via Telegraph):

“Mr Dilnot said a detailed analysis of the best-available Treasury data suggested that real-terms health spending was lower in 2011/12 than in 2009/10.

“At best, he concluded, because of the small size of the changes and uncertainties surrounding them, it might be fairer to say spending had “changed very little” under the Coalition.”

Centre for Economic Performance, LSE:

Since 2010, the NHS budget has been almost frozen in real terms. … Demand and cost pressures have continued to grow during this period of flat-lining expenditure”.

Kieran Walsh, associate director of the National Institute of Health Research, British Medical Journal:

“[The] catastrophic “redisorganisation” of the NHS was a huge waste of time, resources, and effort for almost four years”.

 

9. By raising the tax-free personal allowance, the coalition has made society fairer

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Nick Clegg: “I hope some fair-minded folk would at least acknowledge many of the other things I am very proud I have managed to do to give more opportunities, to create a stronger economy and a fairer society. … The huge tax cuts, which mean you pay nothing, no tax on the first £10,600 you earn as of next week. … These are the things which make a fairer future for future generations and I’m very, very proud of them.” (01:27:10)

Reality: Raising the personal allowance is a tax cut for better-off households.

Evidence:

Institute for Fiscal Studies:

“the poorest third of adults do not benefit at all because their incomes are already below the personal allowance.

“But if we examine the distributional impact at the family level (which is normal for this sort of analysis, since we would expect at least some degree of income sharing within families) … the highest average cash gain occurs in the second-richest tenth of the income distribution”.

Institute for Fiscal Studies (via Huffington Post):

“69% (£8.4 billion) of the £12.2 billion per year giveaway would go to working families in the top half of the income distribution … Just 15% (£1.9 billion) would go to working families in the lowest-income half of the population.”

 

10. Immigration has hugely reduced ordinary people’s pay

Nigel Farage: “We also believe that open-door immigration has depressed the wages for ordinary people …” (00:04:04)

“Net migration … And what it’s meant is for ordinary folk on minimum wage or not very high salaries, their wages have been compressed. It is the ordinary people of Britain that have paid a very high price for the big corporate employers who’ve benefited from low pay.” (01:12:29)

Reality: Immigrants are not to blame for low pay. Immigration on its own has no economic impact: its effects always depend on other economic policies. The minimum wage and changes in the labour market have a far bigger effect. Right now, immigration reduces the wages of the lowest-paid by a tiny amount. It also pushes up average wages.

Evidence:

Oxford Centre for Research and Analysis of Migration:

“The impacts of immigration on the labour market critically depend on … the characteristics of the host economy … the impact of immigration on the wages and employment opportunities of existing workers is always specific to time and place.”

Jonathan Portes, Institute for Economic and Social Research (via Huffington Post):

“… there is some evidence that migration, while having some positive impact on wages overall, might have a small negative impact for the low-paid. But these impacts appear quite small – other factors, like general labour market developments, or the minimum wage, appear to be considerably more important.”

 

11. Immigration has made it harder to get a GP appointment

Nigel Farage: “Immigration has … made it tough to get a GP appointment” (00:04:04)

Reality: A huge number of Britain’s doctors, nurses and staff – including GPs – are immigrants. Curbs on immigration would be disastrous for the NHS.

Evidence:

Stephen Nickell, Office for Budget Responsibility (via BBC):

“The general consensus is that for the native population, the existing population, immigration may be a little bit good, it may be a little bit bad economically. But there isn’t overall that much in it. Obviously there are special situations like in the health service, for example – some 35% of health professionals are migrants.

“It’s quite plain that, if they weren’t there, the health service would be in absolutely dire straits. That’s a special point.”

Health and Social Care Centre (via Guardian):

“Thinktank warns stricter immigration rules could hit [National Health] service after stats show 11% of all staff and 26% of doctors are non-British”

Health and Social Care Centre (via King’s Fund):

“According to figures from the Health and Social Care Information Centre, 20 per cent of the NHS workforce is non-British as of September 2014. This rises to 30 per cent of doctors, when locums are included. According to figures from NHS Professionals, over and above this non-British staff also account for a significant proportion of agency staff working in the NHS, as approximately 31 per cent of nursing shifts covered by agency staff over the past year were worked by foreign staff on temporary visas.”

General Medical Council (via Guardian):

“figures on where doctors qualified are made available by the General Medical Council, which include GPs in its data.

“Mirroring the HSCIC statistics, India is the second most common country of qualification after Britain, according to the council, which says 25,122 doctors registered in the UK were trained in the world’s second most populous nation.”

General Medical Council: More than one third of the country’s doctors trained outside the United Kingdom.

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