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The public sector challenge

Here is part of a press release from the Institute of Economic Affairs, the London-based free market think tank. I could not agree more with what Mark Littlewood, IEA director general, says:

“An overstaffed and overpaid public sector should be the first to face cuts in government spending. It is complete fantasy to pretend that substantial cuts are not required, and it is the public who should feel angry at being expected to support a union campaign which would see their tax money continue to be squandered.

“Public sector workers earn, on average, over £2,000 more than their private sector equivalents1. This is in addition to the more generous pensions they receive and the enormously reduced historical risk of being fired.

“A reduction in the absurdly generous terms for workers in the inefficient public sector is long overdue. It is not an attack on the poor or oppressed, it is an attack on the privileged.”

In a nutshell, much of the UK’s present economic plight can be understood in the light of how, since 1997, the public sector payroll – including all those “private sector” jobs dependent on public contracts, exploded. Pretty much most, if not all, of the big spending rises over which Gordon Brown presided were gobbled up by this enormous rise in public employment. Now of course, if you work in the public sector, you will believe, or at least want to believe, that your job is of great importance, and that those selfish Gradgrinds in Westminster and Whitehall deserve to be attacked. But the point needs to be made that the private sector, increasingly weighed down by taxes and regulations, cannot support this state of affairs; it is an absurdity, as some in the trades union movement claim, to somehow argue that cutting all these public sector jobs will somehow threaten Britain’s economic recovery. Any recovery that relies on an artificial support machine of massive public spending and employment is not a recovery worth having. And remember that what we should be aiming for is to be better off, not simply employed in pointless or destructive “jobs”. If cutting such public sector positions frees up capital for something likely to generate greater wealth overall, that’s great. The question arises, clearly, as to whether this government has the stones to say this over and over. The signs are not particularly encouraging.

9 comments to The public sector challenge

  • Am I the only person who thinks the term “public sector” should be replaced with “government sector”?

    After all, what the government sector does is often not in the public interest. And just try cashing in your share of the government sector.

  • llamas

    “creating jobs” has been the mantra in UK government for so long now (regardless of party) that these clowns can claim that all these public-sector jobs, and more besides, are vital to the economic recovery of the UK with a straight face and noone will question them. The public hears only ‘jobs’, and no longer questions what that actually means in economic terms.

    Given what many of these public-sector jobs seem to actually consist of (after reviewing a few of the situations-vacant listings in ‘The Guardian’), I’m pretty sure that you could get the public to support a massive public-works program to dig holes 4 feet deep, kill puppies and put one in each hole, and then fill the holes up again. Many jobs in the public sector seem to already embody this combination of utter futility and wanton destruction with a streak of cruelty. After all, it’s ‘creating jobs’, isn’t it? And pretty soon, the union representing the workers in the puppy mills producing the necessary supplies to keep this program working would cry out at the mere suggestion that their jobs could be eliminated – adfter all, they’re supplying a vital need that keeps British jobs in Britain!

    Between ‘Yes, Minister’ and ‘I’m All Right, Jack’, what used to be side-splitting farce has now come to be sober reality, in less than 50 years.

    llater,

    llamas

  • John B

    Yes, “creating jobs” has always had a desperate, artificial ring. Along with “the right to work”.
    Why is it not obvious that we don´t need jobs, as such? We need the food, clothing, the wherewithal, that the jobs provide by supplying an income.
    And that working at a job results in an income because one is contributing to the wealth of one´s employer, over and above that which one receives oneself, because it is simply not worth it for someone to give you money for doing something that is not of benefit to him.
    Indeed, it is an exercise in destruction to simply create a job in order to give someone some money.

    But I do wonder why the new Conservatives have to go for such high profile things like education, no matter how bad the particular situation is that they are addressing.
    Surely they should know that the enemy propaganda machine will swing into high gear if any sacred cows are touched?
    Rather go for more of that vast subset of quangos and all that convoluted political machinery.
    I am sure they could find loads of “public service” jobs and activities to cut that no one could pretend to defend and that no one would ever miss.

  • Laird

    Undoubtedly there are a few government jobs which actually need doing. But a substantial number of them are merely disguised unemployment. The incumbents manage to find things to do which fill up their days, and eventually may even convince themselves that it’s productive work. But, in reality, it’s merely yet another illustration of Hazlitt’s Broken Window Fallacy.

    For starters, 25% of all “public” (i.e., government) sector jobs should be eliminated, primarily in the managerial ranks. Of those remaining, there should be across-the-board pay cuts of 10%, with 20% cuts for those making more than $100,000 per year (of which there are far too many). That should focus the attention of the lucky survivors, who might then figure out which jobs actually need doing and perform them more efficiently.

    (Phase 2 would be another 25% layoff, but we don’t need to tell them that just yet!)

  • JadedLibertarian

    Up here in Scotland the SNP are getting themselves in a twist over the possible cancellation of the new super-carriers. “It’ll cost jobs” they say.

    Publicly funded jobs, creating a bleedin huge weapon we have no use for.

    I mean, why not just announce that the whole population will be re-tasked into the construction of a 100 mile tall sculpture of a banana? It would be an equally pointless endeavour, with the added advantage of not pretending to be otherwise.

  • Chuck6134

    We here in the States feel your pain guys…if anything our government sector pensions may be even more crushing, especially at state level. Plus its one of the few unionized sectors of our ‘economy’ which has one party automatically against any sort of trimming or cuts.

    I think we’re slamming into that wall now too though, something has to be done. However I see little interest here to actually tackle the problem.

  • “creating jobs” has been the mantra in UK government for so long now (regardless of party) that these clowns can claim that all these public-sector jobs, and more besides, are vital to the economic recovery of the UK with a straight face and noone will question them.

    I had an argument with some lefties recently who thought sacking public sector workers would deprive the exchequer of their income tax and so the country would be worse off. Arithmetic, like so much else, wasn’t their strong point.

  • Sam Duncan

    Jaded L., I was under the impression that the SNP was opposed to even having a Navy worthy of the name. As I understand it, their policy is for a few fisheries protection vessels (which would be a few more than we have at present because that’s an EU “competence” – but they don’t want independence from the EU), and nothing more. That party is so shot through with contradictions it’s extremely hard to take seriously. Anything to bash the English. Who, largely, pay for it all. And the only likely alternative is Labour. I wish I could afford to emigrate.

    Anyway, from now on I would just point whiny state-sector employees at this:

    Promised economic reforms get under way in communist Cuba; 500,000 state workers to lose jobs

  • The question arises, clearly, as to whether this government has the stones to say this over and over. The signs are not particularly encouraging.