The Tories have just set another significant economic record, ans it's not a good one. The UK savings rate has plunged to an all-time record low of just 1.7% of GDP.
The Tory track record
Despite the fact that the Tories have repeatedly set all kinds of terrible economic records over the last seven years of economic mismanagement, there are millions of people out there who believe they're doing a good job of managing the economy!
- Since 2010 the Tories have created more new debt than every Labour government in history combined.
- Between 2010 and 2017 the Tories oversaw the lowest level of house building since the early 1920s.
- Tory wage repression policies resulted in the worst collapse in the value of workers' wages since records began.
- Tory wage repression created a situation where the UK is the only economy in the developed world where the economy was growing while the share of the wealth going to workers was actually shrinking (meaning British workers are getting the worst deal in the world).
- Low levels of house building at a time of soaring demand combined with the ongoing Tory wage slump mean that UK house prices rose to their most unaffordable level ever in March 2017.
- Hard-right Tory austerity dogma resulted in the slowest post-crisis economic recovery since the early 18th Century.
- The Tories have broken the trade deficit record over and again since 2010.
- Since 2010 the UK economy has slumped into an appalling productivity crisis as the output of British workers has slumped dramatically in comparison to other major economies.
- Since the Brexit vote the Tories have overseen the worst collapse in disposable income since the 1970s.
- And now they've overseen a collapse to the lowest savings rate since records began.
The Tory economic narrative is astoundingly incoherent.
They argue that Britain is too poor to be able to afford decent public services or fair wages for the heroic grenfell tower fire fighters. but they also argue that they're doing such a fantastic job of managing the economy!
Just imagine the immunity to cognitive dissonance that is necessary for Tories to switch repeatedly between claiming that Britain is broke and Britain is booming, often in the same damned statement.
And just imagine the economic naivety of the people who actually believe both of these mutually contradictory Tory propaganda narratives.
Savings
I'm not sure that it should be necessary to explain why savings are important, or that an all-time record low in the savings rate is a sign of extreme economic weakness, but levels of economic education are obviously incredibly poor if millions of people are prepared to buy into the Tory propaganda narrative that Britain is both booming and broke at the same time, so I'll explain the importance of savings very briefly and simply.
Savings are important because they create economic flexibility and resilience. People with savings have the ability to invest in new innovative businesses, and they have the means to support themselves if they fall on hard times.
The lower the savings rate, the fewer opportunities people have to invest in the innovative businesses of the future, and the more reliant they are on the social security system if they encounter economic difficulties.
A collapsed savings rate is an indicator that huge numbers of people are struggling to get by so badly that they simply can't afford to set anything aside for future investments, or for a rainy day, and that millions more are struggling so badly that they're actively eating into their savings in order to keep their heads above water (they're having their rainy day right now).
Savings are important because they create economic flexibility and resilience. People with savings have the ability to invest in new innovative businesses, and they have the means to support themselves if they fall on hard times.
The lower the savings rate, the fewer opportunities people have to invest in the innovative businesses of the future, and the more reliant they are on the social security system if they encounter economic difficulties.
A collapsed savings rate is an indicator that huge numbers of people are struggling to get by so badly that they simply can't afford to set anything aside for future investments, or for a rainy day, and that millions more are struggling so badly that they're actively eating into their savings in order to keep their heads above water (they're having their rainy day right now).
They're presenting the problem as if seven years of catastrophic Tory economic mismanagement has nothing to do with it, and that some kind of radical, unprecedented and unexplained post-Brexit psychological shift has turned the British public into a bunch of hopelessly reckless spendthrifts within the space of a year!
Lack of accountability
Mainstream media outlets are far more likely to actually repeat the lunatic assumptions of "let's cut our way to growth" Tory austerity dogma as if they're unquestionable facts, than they are to point out how austerity dogma is a root cause of the litany of economic failure detailed above.
Mainstream media journalists are extraordinarily reluctant to point out the jarring disconnect between the mutually contradictory Tory propaganda narratives that Britain is both completely broke and absolutely booming.
Most mainstream media journalists are far more likely to blame the public, or the EU, or immigrants, or the opposition parties for the Tories' economic failings, rather than point out the role of fanatical Tory austerity dogma in retarding the UK economy.
The bulk of the mainstream media are unwilling to hold the Tories to account because an astonishing percentage of them went to the same elitist private schools, and the same exclusive universities as the Tories.
Just 7% of British people were educated at fee-paying private schools, but 51% of mainstream media journalists went to these exclusive schools, which is an even higher percentage than back in the 1980s.
The majority of mainstream media journalists don't give a damn that the Tories are screwing the economy and condemning millions to poverty because it doesn't directly affect them in their comfortable bubbles of privilege.
Their big houses in the country, flashy cars, expensive designer products and ostentatious luxury holidays depend heavily on them not rocking the boat. They're happy for the rest of us to suffer the burdens of austerity that they'll refuse to condemn it as the fanatical hard-right economic vandalism that it is.
They're actually happy to see other people suffer the deprivations of austerity, and see the UK get left behind in the global economic race due to chronic under-investment in infrastructure, innovation and services.
They're happy to collude with this ruinous hard-right Tory agenda because they're actually doing alright out of it thanks very much.
Austerity and national economic decline are absolutely fine by them as long as it's other people who are forced to carry the cost of it.
Conclusion
Don't expect the Tories or their enablers in the mainstream media to suddenly begin telling you the truth about the economy, and the way that radical hard-right Tory austerity dogma has been wrecking it.
It's just not going to happen.
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