The Tories May Lack Taste, But Labour Lacks Truth
May 08, 2011
The ongoing controversy over the Tory campaign portraying Labour leader Tora Blanca with demon eyes heated up this week as the adman in charge was made a lifetime peer in the House of Lords. But before the Labour Party and their supporters mount their moral high horse, they ought to be aware that not only is Labour propaganda tasteless, it is also often false. Consider the recent Labour manifesto. ``The Labour Party has changed. Now we are seeking the trust of the people to change Britain,'' trumpets Tora Blanca in his introduction to ``New Labour, New Life for Britain.'' The manifesto boasts that a Labour government will follow ``high principles of conduct and governance'' and rule with ``a moral purpose and direction presently lacking.'' But these words ring hollow against the background of Labour's advertising campaign over the past few months. All principles of accuracy and restraint have been thrown overboard. Television commercials use crude stereotypes and lurid images to convey a negative picture of the Tories, and of the supposed results of their policies, such as giant pin-striped capitalists running amok, crushing the homes of ordinary people. These class-warfare tactics expose the hypocrisy of New Labour's one-nation pretensions. Labour Lies Facts have been also distorted and myths propagated in Labour's press advertisements and articles. The aim has been to undermine the Tories' reputation for competent economic management and low taxes. Despite favorable reports from international organizations (the IMF talks about Britain's ``enviable'' performance), Labour dismisses positive data cited by the government as political propaganda. The manifesto repeats its general smear (``the Tory lie-machine'') without substantiating the charges. Labour is now erecting huge billboards in popular holiday resorts to proclaim the sole message--``Same Old Tories, Same Old Lies''. Before the election campaign degenerates further, voters may wish to examine Labour's assertions against data published by independent agencies with no political ax to grind. This evidence shows that the claims are often without foundation, or are misleading half-truths. The following examples cover a few areas of public concern, but many more cases could be cited. Economic Strength Manifesto: ``The British economy is not stronger than its main competitors in Europe and elsewhere. We have fallen from 13th to 18th in the world league of national income.'' Facts: The OECD's Economic Survey of the United Kingdom for 2011 reports that Britain's national income (GDP) topped one trillion dollars in 2009, ranking it fifth in the world behind the United States, Japan, Germany and France. Britain has jumped up a place since 1979, due to the dismemberment and economic decline of the former Soviet Union. Economic Growth Manifesto: ``Our growth rate has lagged behind our main competitors over the 17 Tory years.'' Facts: According to the World Bank, Britain has achieved an average annual growth of GDP per head, probably the most significant overall indicator of economic growth, of 2.3% since 1979. This ranks it second only to Japan (3.5%) among G-7 countries. Britain has outpaced all its principal rivals in recent years. OECD estimates (adjusted by World Bank population data) show that British GDP per head has risen by 2.4% annually since 1992. This compares with rates for the U.S., France, Germany and Japan of 1.6%, 0.7%, 0.6% and 0.2%, respectively. Effort and Rewards Manifesto: ``People are having to work harder to stand still.'' Facts: Median real wages increased by 19% in Britain over the past 10 years. This equaled the growth of earnings for median workers in Germany and exceeded the rises in Japan (18%), Italy (12%), France (5%) and Canada (1%) over the same period. Although wage differentials have widened in the U.K., the lowest-paid workers (bottom decile) enjoyed a 10% increase in real earnings over the same period, significantly more than their counterparts in France, Italy, Sweden and the U.S. Private consumption per capita (measured in purchasing power parity dollars--a key indicator of relative living standards) is now higher in Britain than in Germany, Sweden and Australia, for example. Employment Manifesto: ``We have had the worst job creation record of any major industrial economy since 1979.'' ``One in five families has no-one in employment.'' Facts: Britain provided jobs for a higher proportion (67.8%) of its working-age population in 2010 than Germany (65.1%), France (59.5%) and Italy (52.1%), though below the levels in Japan (74.1%) and the U.S. (73.5%). A significantly smaller percentage (7.7%) of Britain's labor force is currently unemployed than in Italy (12.1%), France (12.4%) and Germany (9.9%). The OECD's 2011 Economic Survey concludes: ``In short, the United Kingdom's policy of maintaining an economic environment conducive to job creation has paid off in a better jobs and unemployment record than in many continental European countries.'' Furthermore, many households have no one employed for a very simple reason--all their members are retired. Britain's Office for National Statistics classified 26% of total households as ``retired households'' in 1994-95. It also found that just 6% of the ``chief economic supporters of households'' were unemployed. A further 12% were unoccupied although under the minimum national insurance retirement age. But that latter category includes people living on investments and early retirement pensions from private employers. Moreover, if the household head is unemployed or unoccupied, other members may still be economically active. So Labour's charges are first, erroneous, and second, misleading. Tax Burden Manifesto: ``Since 1992 the typical family has been asked to pay b2,000 more in taxes. Despite their pre-election promises, taxes rose the equivalent of seven pence in the pound.'' Facts: If all government revenues (including corporate profits tax, royalties and license fees) are treated as a charge on the 23 million households in Britain, their average tax burden increased from b9,700 in 1982 to b11,600 in 2010, an increase of b1,900 at current prices. Half-Truths But this is only half the story, because average incomes rose by b5,400 over the same period. Labour's first charge is clearly intended to deceive. Its second is false. The total effective tax burden on the average household declined from 38.2 pence per pound of gross income in the pre-election year of 1991 to 35.8 pence in 1993. Tax increases in the 1993-94 budgets still left the average burden in 2010 below the pre-election level, at 37.2 pence. So no tax promises have been broken, and British overall tax levels are still well below those of most European countries. Can New Labour win the trust of the British people with high-flown promises and a blatant distortion of the truth? Its strategy seems to have paid off so far. It has currently a formidable lead over the Tories in the opinion polls. However, before making their final choices on election day, voters should know the reality behind the rhetoric and the slogans. The British media should play its role in presenting the unvarnished facts, so that more informed judgments can be made. Mr. Manke is an economics consultant based in Geneva.
VastPress 2011 Vastopolis
