The first winter election in decades has been characterised by a blizzard of untruths. Boris Johnson’s party appears to have learned a lesson from Donald Trump’s winning 2016 campaign: if you lie early and often, voters will abandon any attempt to sort truth from fiction. The Tories are barely even pretending to care about policies. Their manifesto may surprise us, but what has dripped out so far suggests it will be thin gruel.
Instead the Conservative fake-facts factory has produced a series of misrepresentations about Labour’s economic plans – which we should expect Johnson to repeat in tonight’s special BBC Question Time leaders’ debate.
Here are six myths to look out for:
• The Tories claim that Labour will produce a tax rise of £2,400 for every worker – calculated by dividing the total increase in taxes by the total number of workers. But this is obviously absurd: the tax system doesn’t raise either the same amount from every individual, nor does all tax revenue come from workers. Labour’s tax plans would substantially increase taxation on businesses, whose profitability is at record highs; on the wealthy, who have been lightly taxed for a generation; and from higher earners, by modestly raising taxes on the top 5%, those who earn more than £80,000 a year.
• Labour’s plans to raise corporation tax from its current level of 19% to its 2012 level of 26% has been claimed to be “the highest rate in the world”. This is pure bunkum. According to figures from the accountancy firm KPMG, the corporate tax rate in France is 31%, in Japan it is a precise 30.62%, in Australia and Germany it is 30%, and even in the heart of global capitalism, the US, the rate is 27% (the federal rate of 21% is supplement by state taxes).
• The Conservatives’ dodgy dossier on “the cost of Corbyn” made the claim that Labour planned to spend £1.2 trillion – even as the Tories have failed to set out their own plans. The reality is that Labour’s national transformation fund, of £400bn, amounts to raising public investment to around 4.6% of national income. Not only does this follow 40 years of chronic underinvestment – meaning there is a large backlog – but it is well within the mainstream of other countries and still below high-investment economies such as Norway and Sweden. By 2023-24, the increase in government spending would be £82.9bn, which would be funded by tax rises. Taken together, this is about £500bn short of the £1.2 trillion myth.
• Expect to hear the Institute for Fiscal Studies claim that Labour’s tax-and-spend plans are “simply not credible” repeated over and over again. But this claim does not stand up to scrutiny. It is true that Labour’s plans represent a radical departure from recent economic policy in this country, but they are mainstream in many other European countries. According to the IFS’s own figures, the size of the state would rise to 44% of national income. But data from the OECD reveals that to be around the same as Germany, and smaller than France, Italy, Austria, Sweden, Denmark, Finland, and Norway. It is simply not credible that the UK cannot follow in the path of other similar countries.
• This style of thinking is intimately connected to another old myth that may be wheeled out tonight – the claim that austerity was necessary because the last Labour government had overspent and that the UK economy is now strong. After a lost decade for the UK economy, with stagnant wages, flatlining productivity growth and weak international trade, it’s clear that austerity was a political choice – and one that fundamentally undermined the recovery. If we are to achieve escape velocity from the low wage, low-productivity model that the economy has settled into, then decisive government intervention is required. On the fundamentals, the UK economy is weak, not strong.
• Johnson will be certain to repeat his mantra, “Get Brexit done”, and boast of his “oven-ready” deal. The reality is that if his deal passes, then it will precipitate an almost immediate crisis over whether or not to extend the transition beyond the end of 2020 – a decision that must be reached by the end of June next year. With the average trade deal taking seven years, there is no realistic prospect of a deal being completed within 11 months. The Tories’ European Research Group know this, and will work to sabotage any extension or any deal in pursuit of their fantasy of an exit on World Trade Organization terms – which would decimate what is left of manufacturing in this country. The reality is that the election of a Conservative government means a decade of arguments about Brexit, rather than the end of it.
Johnson’s obfuscation masks his lack of confidence in any detailed offer of his own. When it comes to his party’s central proposition – to take Britain out the EU, abandoning the single market and customs union for a US trade deal that sells out the NHS – they know voters will rightly fear it. Johnson isn’t just lying because he has always had a casual relationship with the truth. He is lying because it’s the only way that he can secure power.
• Tom Kibasi is a writer and researcher on politics and economics. He is writing in a personal capacity
