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The Rally Against Debt

    When the 'Rally Against Debt' idea was first established, I was sceptical about attending. It would have felt odd marching as public sector workers lost their jobs, I thought, even though I knew full well (and have long argued) that the cuts are entirely necessary in reducing the budget deficit.

    Essentially, the Rally is a counter-march to show that there is recognition among the public that the deficit needs to be reduced and that governments cuts are broadly the right course. Many of those marching objected to Ed Miliband and the unions exclaiming that they represented the British public, when in fact over 57% of people support the cuts or want them to go further.  

    I have to admit, my reservations about attending broadly came as I have some vested interests here. My step-mother is likely to lose her job as a result of Ministry of Defence cuts; my father's long-term future at BIS remains unclear. It’s a difficult position for the family to be in, but by-and-large there is an acceptance even among my parents that cuts do have to be made in order to improve the public finances.

    Which is why I was so amazed, angered and shocked by the reaction to the Rally by some in the supposed ‘mainstream media’. Judging by the outbursts of the likes of  Michael White in the Guardian and Richard Godwin in the Evening Standard, one would think the marchers were attending a Nuremberg Rally or a Klu Klux Klan march. There is a genuine feeling by the journalists, and many left-wing activists, that anyone who feels the government cuts are appropriate must be nasty or evil. Added to the emotional outpourings on the ‘savage nature of the cuts’ from the likes of Cath Elliott, one would be forgiven for thinking that the Coalition were marching us all to a certain death.

    They all show a complete ignorance of the reality of our fiscal situation. So distorted has the debate on cuts become, that people have forgotten why we are cutting in the first place. Without a credible plan for reducing the deficit, we would risk our borrowing costs sky-rocketing, the national debt becoming unserviceable and having a severe austerity programme imposed upon us by international bodies. Most of those attending the rally aren't therefore marching to glorify people losing their jobs. They are marching in support of the government's programme in which modest cuts over the next four years will save us from the sort of massive austerity programme being imposed on Portugal and Ireland.

    The government has been terrible in explaining this.

    And in truth, the current government's ‘cuts’ plan is relatively modest. Overall real terms government spending will fall by just 3% over the course of the Parliament.

    This hardly appears savage to me.

    But there are several reasons why these modest savings will still hurt:

    a) the proportion of total expenditure on interest payments is going to increase significantly as we continue to increase overall national debt.

    b) the government has ring-fenced NHS and international aid spending

    This means that unprotected departments will face real terms cuts of between (on average) 10 and 11% over the course of the Parliament. Bigger, but still not ‘massive’ or ‘savage’. Spending on unprotected departments will still be 36% higher than ten years ago.

    But more importantly, if we were to carry on spending as now, interest payments would increase even more rapidly, making the structural component of the deficit even more difficult to eliminate in future.

    The unions are therefore essentially arguing for much more significant cuts in the future.

    So angered have I been that this argument has not been effectively made, so angered by the sensationalism in reporting the scale of the cuts, and so angered by the Left’s complete dismissal of the view that anyone might in fact support them, I am now definitely going to attend.

    No, I am not the son of a banker. I am not from a wealthy background. I didn’t go to private school. In fact, I was on free school meals, attended state school and have public sector workers as parents. But this hasn’t blinded me from the fact that the arguments of the unions are illogical and economically illiterate.

    Cutting now to prevent a sovereign debt crisis isn’t evil. The OECD isn’t evil. The European Commission isn’t evil. I’m not evil. What we all share is the view that however painful the cuts we are making today are, the only true alternative would have been much, much worse.

    *Puts on tin hat*.

    Ryan joined the Centre for Policy Studies in January 2011, having previously worked for a year at the economic consultancy firm Frontier Economics.

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