From the May 27, 2009 Daily Telegraph
May 27, 2009
by Irwin Stelzer
There are several varieties of crook. Some we glamorise. Butch and Sundance (Newman and Redford). Robin Hood (Errol Flynn et al). Bonnie and Clyde (Dunaway and Beatty). Bugsy Siegel (Beatty again). Various Mafiosi (Brando). Some we revile. Bernie Madoff, drug dealers.
Then there is the thief. Although we create glamorous fictitious thieves for our amusement – David Niven's Pink Panther, Cary Grant's jewel thief, John Robie – there are few real-life thieves whom we have come to admire. My Oxford English Dictionary defines a thief as: "One who takes portable property from another without the knowledge or consent of the latter, converting it to his own use."
It would be unfair to pin the label "thief" on any MP until proper investigations are completed, even though some have surely been helping themselves to dubious expense reimbursements "without the knowledge or consent" of those from whom they extracted funds. But as more than one observer has pointed out, it is the awful smallness of it all that is appalling – Kit Kat bars, tampons, bath plugs. Even the dredging of moats and the repair of tennis courts involved pathetically small sums from the vantage point of those protected by the moat or practising serves and lobs without the trouble of queuing at a country club. Little wonder that it took a five-year battle to shed light into this dark corner of parliamentary practice.
The saddest part of this story is that all of the appropriation of perks, whether within or outside of the self-constructed rules, was the equivalent of petty cash when compared with what these men and women do in the full glare of publicity. They take from the not-so-rich to give to the better-off, from middle-income taxpayers to feed the insatiable appetite of public-sector workers whose pay and pensions are higher than those being taxed to fund the ever-growing state. The median pay of public-sector workers exceeds that in the private sector by about £3,000 per year – more, in Scotland. Ninety per cent of public-sector workers are in generous final-salary pension schemes; only 12 per cent of private-sector workers are so lucky. Public-sector workers claim more sick time and generally work fewer hours. Little wonder that more and more graduates are attracted to the growing public sector.
One of the legitimate functions of government is to redistribute incomes. But the actions of the majority party are distinguished by the sheer awfulness of their enormous scale – billions directed to a public sector that has grown from 5.2 million to 5.7 million workers but has not delivered commensurate improvements in education or health care. Billions borrowed now to be repaid by future generations in the form of higher taxes, runaway inflation, and a reduced standard of living. Of course, those bills won't come due until after the next general election: jam today, thin gruel tomorrow.
And billions wasted. More than £40 billion spent every year on quangos, and rising at an annual rate of 13 per cent. Almost £900 million spent on severance pay for 15,000 civil servants while recruiting an additional 42,000 for permanent jobs. Some £4 billion to be spent on consultants over the next three years for work on "naming, branding and positioning", "culture change" and "equality and diversity", among other projects. Over-runs on the Olympics. Millions spent on an NHS IT system that will never really deliver its promise.
All governments generate wasteful spending, as do all very large private-sector companies. The latter are now paying the price for mismanagement, and failure to prepare for a downturn. But the Prime Minister and his colleagues who brought the nation to the brink of financial ruin remain in place, and refuse to submit their policies to the test of a general election. Private-sector shareholders have often been wiped out; most MPs remain in place, and public-sector pay continues to rise.
All might be forgiven if the massive spending and borrowing paid off. After all, in a recession it is arguable that increased spending is necessary to make up for the deficiency in private demand – no one has ever definitively proved that Keynes had it wrong. And there is no question that the nation's infrastructure and social services needed refreshing, as New Labour argued in 1997.
But the awfulness is that the money has been poured into a public sector that never was forced to submit to the reforms that the then-chancellor swore would precede the expenditure of an additional penny. The Rowntree Foundation puts Britain at the bottom of the EU15 countries in child poverty. Almost one million people more are in severe poverty now than when Labour took over, according to Tory data. The gap in life expectancy between rich and poor "is now at the widest since the Victorian era", reports Jesse Norman in the Guardian. Frank Field calls Government job-creation schemes "an expensive failure".
Britain-watchers here in America are betting that it will take the IMF to get Britain on a long road back to fiscal sanity and economic growth. The Tories believe they can do the job. Perhaps the voters should be allowed to choose between IMF slashing of spending or the "Tory cuts" that Gordon Brown derides.
Irwin Stelzer is a Senior Fellow and Director of Economic Policy Studies for the Hudson Institute. He is also the U.S. economist and political columnist for The Sunday Times (London) and The Courier Mail (Australia), a columnist for The New York Post, and an honorary fellow of the Centre for Socio-Legal Studies for Wolfson College at Oxford University. He is the founder and former president of National Economic Research Associates and a consultant to several U.S. and United Kingdom industries on a variety of commercial and policy issues. He has a doctorate in economics from Cornell University and has taught at institutions such as Cornell, the University of Connecticut, New York University, and Nuffield College, Oxford.
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