Via CBC Manitoba. May 31, 2016
Deficit fearmongering useful for politicians who want to justify cuts to public service, David Camfield writes
The new Progressive Conservative government wants Manitobans to believe the province's deficit is a problem. The claim that the deficit for the 2015-16 fiscal year topped the easy-to-remember $1-billion mark is suspiciously convenient. As a Winnipeg Free Press editorial noted, "there is lots of room in the provincial ledgers to move numbers around."
The Canadian Taxpayers Federation, eager to spur the government toward cutbacks, insists the debt is "a heavy burden" and "bad programs, and even some good programs" will have to be eliminated.
But the claim that the deficit is a significant problem for the Manitoba government is a misleading and dangerous fabrication.
The real issue for any government is not the size of its deficit but how much it costs to service its accumulated debt. When governments spend more than they take in in revenue, they sell bonds to raise funds. A government's credit rating affects the rate of interest it has to offer in order to attract buyers for its bonds.
Manitoba's debt servicing costs are eminently manageable. Interest rates are low and all three of the main credit rating agencies that assess provincial governments give Manitoba a good score. Only a minority of provinces are ranked better.
Credit rating agencies aren't neutralEven so, it's important to point out that credit rating agencies are not the neutral technical information-providing services they claim to be. They are private firms that belong to broader corporate networks. The people who run them and issue ratings for governments are committed to a particular ideology: neoliberalism. Their evaluations of governments reflect this. For example, in 2013 Standard and Poors downgraded France's credit rating in spite of the French government's fiscal restraint. U.S. economist Paul Krugman pointed out that this move was driven by S&P's opposition to the French government's decision to raise taxes instead of "dismantling the welfare state."
What we are given by those who argue for deficit slashing is, as British political economist Hugo Radice puts it, "an entirely circular argument. We are told by supposed economic experts that deficit cuts are necessary because international bond markets require them. So why do the investors in international bond markets require cuts? Because the economic experts say they are necessary!"
If Manitoba's debt is objectively manageable, why is there such a hue and cry over the deficit? Such fearmongering is useful for politicians and lobbyists who want to justify cuts to public services.
Those who insist that the deficit is a problem also preach that the solution is austerity. This means cutting public spending, privatizing public services and reorganizing what's left of the public sector along corporate lines (corporatization). This is part of the neoliberal project of dismantling anything that could be a barrier to corporate profits, including workers' rights, environmental protection regulations and corporate taxes.
'Austerity policies … hurt demand'Unfortunately for those who would have the Manitoba government slash spending, there is growing dissent among neoliberal intellectuals about austerity. In the June 2016 issue of the International Monetary Fund (IMF) publication Finance and Development, IMF researchers Jonathan D. Ostry, Prakash Loungani and Davide Furceri question this approach. They echo what many critics of neoliberalism have long argued: "austerity policies … hurt demand." Economic output tends to fall and unemployment rises, which increases the need for spending on social programs. "Faced with a choice between living with the higher debt… or deliberately running budgetary surpluses to reduce the debt, governments with ample fiscal space will do better by living with the debt," they suggest.
Even where debt servicing costs do create a crisis for a government, austerity is no solution. We can see this clearly in what's happened in Greece in recent years. Wave after wave of cuts and neoliberal "reforms" have hacked away at jobs, wages, services and rights, leaving most people much worse off.
Manitobans should worry not about the deficit but about what the new government plans to do to public services in coming years in the name of lowering the deficit. The previous government avoided major spending cuts. Nevertheless, many people who work in provincially funded organizations such as hospitals, universities and social service agencies are already overworked and hard-pressed to deliver the high quality of service to which they're committed. Austerity justified by the deficit myth threatens to make matters much worse.
David Camfield is an associate professor in the labour studies program and the department of sociology at the University of Manitoba. He is the author of the chapter on Manitoba in a forthcoming book on fiscal policy and public services in Canada's provinces.
These are some things I've learned from my own experience, talking to others and reading about the experiences of many political groups of the radical left that I'd like to share with members of Solidarity Winnipeg. I'm not suggesting them as "Ten Commandments" (and I'm not auditioning for the role of Moses)!
1. A political organization needs all members to understand its common politics and purpose in order to be able to function coherently. This shared understanding also gives a political organization a framework for discussing and debating differences. Without this, a group will fragment.
2. The more minimal a group's shared politics are, the more important activity is for holding a political organization together (Solidarity Winnipeg has a very minimal basis of unity).
3. If a political organization says that social struggle is key to changing society, its members need to practice what they preach. Belonging to a radical political organization shouldn't be an alternative to being active in organizations that actually mobilize and organize wide layers of people in collective action for change (unions, groups based in communities or on campuses). The weaker such movement-building organizing is (it's been very weak in Winnipeg for many years), the more important it is to consciously try to get involved in what's happening.
4. A political organization whose activity is democratically-organized and in which members are accountable to the group will make better decisions, be better able to learn from mistakes, and be generally smarter and stronger.
5. The less a group asks of members, the less commitment it's likely to get from them (so far SW hasn't required anything from members).
6. Political education for members matters. It's inevitable that members will have different kinds and levels of political knowledge, skills and experience. Consciously trying to foster members' political development will make a group more effective. Political development will also make a group more democratic, since more members will feel able to develop proposals and take part in discussions. The goal should be a "leader-full" organization (a term I learned from reading about Black Lives Matter organizing in the US), not a leaderless one.
7. One of the most crucial things for radicals to try to understand is the context that they're working in. The political context of Winnipeg today isn't the same as Winnipeg in 1919 or even 1996. It's also not the same as Toronto or Montreal today (Alan Sears's book The Next New Left: A History of the Future offers valuable analysis of the political environment today and how it's different from past eras).
8. It's important to evaluate decisions in order to learn from them. Mistakes are inevitable but learning from them isn't.
9. It's really important to foster a group culture that's welcoming to new people and in which people treat each other with respect even when they disagree. But working together as members of a political organization shouldn't be confused with being friends. A political group should unite people who agree with its politics and want to work together for common goals whether or not they know or like each other personally. Some members will become friends too. But if a political group is a group of friends it can quickly become a clique that isn't welcoming to others.
10. Having clear positive expectations about how members should conduct themselves and procedures for how to respond to allegations of unacceptable behaviour gives a political organization a way to handle problems that will inevitably arise. After all, those of us committed to radical change are products of a messed-up society, just like everyone else.
 I've always liked this line from the US socialist Eugene Debs: "Too long have the workers of the world waited for some Moses to lead them out of bondage. He has not come; he never will come. I would not lead you out if I could; for if you could be led out, you could be led back again."
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