this post was submitted on 16 Aug 2023
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Neoliberal
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Free trade, open borders, taco trucks on every corner. Latest discussion thread: April 2024 **We in m/Neoliberal support:** - Free trade and competitive markets
- Immigration
- YIMBYism – ‘yes in my backyard’-ism
- Carbon taxes
- Internationalism and supranational governance – e.g. the EU, UN, NATO, IMF
- LGBTQ+ rights
- Democracy, human rights, civil liberties and due process Neoliberals can be found in many political parties and we are not dogmatic supporters of specific parties. But we tend to find ourselves agreeing more often with parties that espouse liberal values, internationalism and centrist economics, such as the Democrats in the US, Liberal Democrats in the UK, FDP in Germany, Renaissance/MoDem in France, the Liberal Party in Canada, and so on. **Further reading** - I’m a neoliberal. Maybe you are too.
- The neoliberal mind
- Neo-liberalism and its prospects
- Neoliberalism: the genesis of a political swear word **News sources** Here are some suggested news sources that we like and tend to find reliable. Please note that posts and threads are not at all limited to these sources! - The Economist https://www.economist.com/
- Financial Times https://www.ft.com/
- The Guardian https://www.theguardian.com/
- New York Times https://www.nytimes.com/
- The Atlantic https://www.theatlantic.com/world/
- The New European https://www.theneweuropean.co.uk/
- Vox https://www.vox.com/
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The article is called "The west has forgotten the limits of government" and proceeds to make several partially misleading talking points in favour of austerity. The author has, I think deliberately, forgotten the downsides of austerity - reduced growth, lower tax take so even worse government finances, and of course unnecessary hardship for ordinary people who didn't cause the global credit crunch, didn't cause energy hyperinflation, didn't cause greedflation and are just trying to make rent, buy food and heat their homes in the winter. Our financial problems shouldn't be taken out on them.
Ah, got it - I think you've made a leap there though.
The article is making the point that, just as Laffer curve advocates on the right incorrectly assume that all tax cuts will become self-funding through increased growth, there is also a problem of people on the left assuming all public spending will become self-funding too by increasing skills/technology/public health/etc.
But that doesn't mean that no public spending is self-funding. And it also doesn't mean that this isn't a reason to do public spending - it's just that the state should spend money on projects because we think they're worthy of public money, not because of rose-tinted views that every public project is an investment that's going to pay for itself. It doesn't particularly strike me as advocating austerity, so much as advocating that the pendulum shouldn't swing too far in the other direction either.
A bit of healthy scepticism (about the biases of both left and right) regarding what the state can and can't achieve is generally a good trait in public policymaking.
The tax cuts tend to be accompanied by the austerity - the cuts to spending on welfare etc that you didn't mention at all, but which reduce growth because the folks at the poorer end of the income distribution don't have any income to spend. Tax cuts don't stimulate growth because they tend to disproportionately benefit wealthier folks who tend to save the extra cash than splurge it. It just takes money out of the real economy and gets turned into rental properties which takes even more money out of the real economy. If you increase benefits, you get an immediate increase in consumer activity and services because the hordes of ordinarily-incomed folks have plenty of things they need and want to spend on and couldn't. Not to mention the hardship that comes from severe lack of cash.
Small government isn't good in itself for any particular reason other than further wealth hoarding by the already comfortably off. This article is a fairly unmitigated argument in favour of small government and it takes no account whatsoever, and neither have you, of the ills visited upon ordinary folks by austerity. It's not a balanced argument, and making out that it's in the slightest bit centrist is "alternative facts".
Also, the UK is not in the slightest danger of the pendulum swinging too far the other way.
What tax cuts? The only reference the article makes to tax cuts is to a) criticise the sort of blanket Laffer curve-ism that the political right are guilty of, but b) note that, just as sometimes Laffer curve-ism can be correct, so sometimes the belief that government spending pays for itself can be correct. The article doesn't at any point advocate tax cuts.
I think you made an (I think incorrect) assumption about the author's intent when you read the article and so are imposing a bunch of assumptions on to it that don't reflect the actual words that are written.
The authors intent was clearly and obviously to dissuade people from supporting government expenditure that has anything like an aim of improving the country. You're trying to convince me that the author, (who labels Biden as anti capitalist and Sunak as anti London) isn't attempting to convince governments to spend less. It isn't working. "See how it never works! Laugh at the naivety of trying to make things better! Worry about the government spending your money! Worry about the debt you somehow personally participate in as a result of government spending!" The article is so wholeheartedly pro small government, anti big government and anti social intervention, it's absurd of you to claim it's not arguing for reduced government spending and reduced tax intake. It isn't saying it explicitly very often, but the only point against tax cuts (and the one you keep bringing up) is that they might not be self funding. It's not arguing that tax cuts always bring in more tax, no, but it is arguing for reducing taxation by spending less on "investment".
You're trying to convince me that there's no wood by drawing my attention to several trees, and even some tufts of grass. You have missed the point of the article which is to reduce government spending, especially outside London. Cuts. Cuts hurt. They hurt the poorest most. You've never addressed that point and you're misrepresenting the purpose and the message of the article.