House of Lords
Queen’s Speech Debate
| Monday, May 21, 2012
My Lords, Sigmund Freud identified a defence mechanism that he called denial, in which a person faced with a fact that is too uncomfortable to accept insists that it is not true, despite overwhelming evidence. A good example of denial is the Chancellor's belief that austerity is a growth policy, despite the fact that the British economy is shrinking. Somewhat better than a state of denial is one that psychologists call cognitive dissonance, a condition of holding two contradictory beliefs at the same time.
People in such a condition have a strong need to reduce the importance of one of the dissonant elements. This is more hopeful. If the Chancellor has moved from denial to cognitive dissonance, he may soon move from cognitive dissonanceContinue reading...
My Lords, it is a sign of the jittery state we are in that a slower-than-expected slowdown in the rate of growth is hailed as strong evidence of recovery. Of course it is nothing of the sort. It marks the end of a period in which the economy has been supported by fiscal policy, with some help from the depreciation of sterling. The direction of fiscal policy has now been reversed. In their recent comprehensive spending review, the coalition Government confirmed that they will embark on cuts that will withdraw between 1.5 per cent and 2.5 per cent of nominal demand from the economy every year for the next four years.
The Government's own independent watchdog, the Office for Budget Responsibility, has estimated that every 1 per centContinue reading...
My Lords, the Finance Bill implements the taxation provisions of the emergency Budget Statement of 22 June. These will come to about 20 per cent of the total fiscal tightening which has been planned in this Parliament. So the Finance Bill as we have it before us is part of the Government's programme for balancing the Budget over the next five years. In his opening speech, the noble Lord, Lord Sassoon, said that a failure to address the deficit is the greatest danger we face. I would say that the failure to address the hole in the economy is the greatest danger we face and that unless the noble Lord is able to demonstrate how cutting the deficit will produce an economic recovery, there is a massive hole in his speech. I listened in vainContinue reading...
My Lords, I congratulate the Minister, the noble Baroness, Lady Wilcox, on her appointment to her important new responsibilities. I regret only having to turn my head to the left rather than the right to get the full flavour of the masterful performances of the noble Lord, Lord Myners, that I have come to expect and which, indeed, we got today.
In the Crimean War, it is said that Lord Raglan, a veteran of the Peninsular War, announced his plan of campaign to the assembled commanders by pointing to the map and saying, "We attack the French here", at which point an aide whispered to him, "Sir, the French are our allies". I trust that members of the coalition will not be afflicted by a similar cognitive dissonance.
The Government have
My Lords, as this is a money Bill, this House cannot amend it, but I shall discuss the motives and principles underlying it. My speech will not give satisfaction to the two opposing parties, but I hope that, for that reason, it may gain in coherence. As the noble Lord said, we shall see.
The Government are in a bind. The markets are clamouring for retrenchment. On the other hand, the Government know that retrenchment now would be fatal for recovery. This rather feeble measure is the result. It reminds me of nothing so much as the optimistic promises that I used to make to my bank manager when he called me to ask what I intended to do about my overdraft. This, of course, was in the days when I knew who my bank manager was. He was called