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Paul Sweeney: Austerity won't work, it never has

Taking a walk around central Glasgow today, you can’t help but be dismayed.


Handsome buildings crumbling and inundated with vegetation, retail units boarded up, and once proud streets strewn with litter and graffiti.


Our city centre was once the pride of Scotland with shopping, entertainment and nightlife making it an attractive and desirable destination for residents and tourists alike.


Historically, Glasgow has punched well above its weight socially and culturally.


We have art galleries that are world-class with Rembrandt, Monet, van Gogh and Dali works amongst our vast collection, theatres that have hosted Laurel and Hardy, and music venues that have seen the rise of some of the greatest bands in the world.


Our parks and open spaces earned our city the moniker of the ‘Dear Green Place’, our architectural golden era in the late 19th century paved the way for art nouveau pioneers like Charles Rennie Mackintosh, and our industrial prowess saw Glasgow’s name stamped on engineering products exported all over the globe.


The picture in 2022 couldn’t be further from those halcyon days if it tried.


Our once famous institutions have been ravaged by over a decade of austerity, while our cultural establishments and architectural heritage have been left to rack and ruin by a city council bereft of ideas and seemingly paralysed by the scale of the challenges our city faces.


Tackling these problems should be at the forefront of the minds of every Glaswegian.


The decline can be reversed but only with coordinated, comprehensive action; action that is not only long overdue but ever more necessary.With the UK and Scotland’s economic woes providing a grim backdrop, it is easy to see why action might be postponed, or why other areas of policy might take precedent. I would argue that is a fundamentally flawed outlook.


We have tried austerity; indeed, it has been imposed on the Scottish public by both of our governments for over a decade. It has resulted in one thing and one thing only - decline. A decline in living standards, a decline in wages, and a decline in opportunities.


Astonishingly, the Chancellor’s budget last week puts us on a collision course with austerity 2.0. It was a budget that the Office for Budget Responsibility says will result in a 7% drop in household incomes over the next two years, culminating in the biggest fall in living standards since records began.


The irony is that drop in living standards and squeeze on household budgets will result in unemployment surpassing half a million by the end of 2024, with those who find themselves unemployed becoming reliant on the state for social security payments.


Those of us who disagree with austerity economics are often decried as irresponsible fantasists, but that could not be further from the truth.


The harsh reality is austerity failed the first time, and it will fail again.


First time round it delivered flatlining growth and eroded the wages and conditions of working people. It will do so again this time round.


At a human level, its impact was disastrous. We saw it first-hand in our own city, with recent research from the University of Glasgow and the Glasgow Centre for Population Health showing that over 330,000 excess deaths were linked to the policy of austerity that began in 2010.


That is a gruesome legacy of destroyed and damaged lives that we simply cannot afford to repeat.


This recession is predicted to be shallower but much longer than the one we experienced after the credit crisis of 2008, but this time we are operating against a backdrop where public services, ordinarily the last bastion against austerity measures, have been eroded to the point of collapse.


And that is why more of the same failed austerity mantra won’t work; there simply isn’t the capacity within our economy or our services to weather that storm. Instead of austerity, we need to look at investment in areas that will produce positive returns and investment that will be felt by the people who need it most.


Currently, we are tragically over-reliant on imported energy which has left us incredibly susceptible to geo-political events. That means households are increasingly vulnerable to shocks in our energy market, with the poorest households disproportionately impacted.


We have a workforce that is stagnant with critical demographics frozen out of work for reasons like the cost of childcare, and we have a productivity crisis that is borne out of a crisis in our skills and retraining landscape.


An overhaul of private, foreign owned businesses that suck money out of our economies instead of positively contributing towards them is also long overdue. Take the recent phenomenon of purpose-built student accommodation that has become a staple of the city’s skyline.


Why are we allowing businesses, many registered in tax havens, to build what they want where they want, before siphoning their profits offshore?


They contribute nothing to our economy as students pay no council tax, and the immense profits generated are never reinvested into the city.


It is an area we could be using the power of the public sector to invest in. These businesses are extremely profitable, they would not be in business otherwise.


If a city corporation was to develop and manage similar properties while reinvesting the profits back into the city, it would have a hugely positive impact.


That is where we should be focusing - investment, not further austerity. Investment that will result in positive returns and improve the lives of Glaswegians.


That can’t be achieved by embarking on another prolonged period of austerity. All that austerity economics will achieve is the hollowing out of our cities, the erosion of people’s incomes, and the further decline of our local and national economy.


That is not a price we can afford to pay.


You can view the column on the Glasgow Times website here: Paul Sweeney: Austerity won't work, it never has | Glasgow Times


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