Pop-Keynesianism

Now there's a phrase I never thought I'd write.
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One of the more remarkable phenomena of the discussion around the budget has been the emergence of, what can only be called, Pop-Keynesianism among the left-wing media.  Now there's a phrase I never thought I would ever say.  The financial crisis in general was widely reported to have brought about a resurgence of interest in and influence of Keynesian policies.  At least nominal adherence to keynesianism was the principle mark of economical policy-making from the 2nd World War until the end of the 1970's.  Now, Keynes was a genius, and one of the very few most important figures in the history of economics.  His great insight was to argue that governments could have role to support economic activity by borrowing and spending in times of recession to boost the economy, by boosting general demand, and thus easing the effects of recession and supporting growth by combating the generally deflationary spiral of recessions.  But too often, though, keynesianism was used as merely an ideological cover for ever higher state spending, and this, among other things led to its discrediting as a driver for policy in the neo-liberal reforms of the 1980's.  With the coming of the recession, though, we have experienced a supposed revival of keynesianism, as governments turned to fiscal stimulus to combat the effects of recession.

More recently still, the banner of Keynesianism has been seized by those opposing the austerity plans of the Coalition and the Conservatives particularly.  In a way it is good to see debate on public policy being supported by appeal to scientific principles, rather than vague emotion as is far too common.  However, recently this has reached the stage of the ridiculous.  Indeed, there was a period shortly following the budget, when, for a few weeks, the Independent and Guardian seemed to be running a rent-a-keynesian contest to see if between them they could manage to have at least one commentator a day accusing the Coalition of forgetting the lessons of Keynes and reverting to what was variously called pre-keynesian barbarism, a reversion to the economics of the 1930's, and various other mindless insults.  All with the intention of insinuating that the fiscal hawks were seemingly just naively unaware of the great Keynes' achievements, the poor, simple dears, and were certainly going to tip us back into economic Armageddon.  Suddenly, every half-baked leftist political commentator was an economics major (for example).

But the credibility of these new experts as invaluable fonts of economic theory would be considerably greater were it not for two niggling issues.  The first problem is the repeated claim, by a number of smug commentators, about the madness and ignorance of seeking to enact savage cuts whilst in a recession.  This criticism, if true, would be pretty decisive. But it has just one small problem, which hopefully you can spot:  we are not actually in recession.  For me, personally, the ability to totally miss this basic fact about our economy shakes my faith in their pronouncements on policy.  No one has suggested cutting during a recession, and not only are we not in a recession (and have not been for 9 months), but these commentators have equally seemed to miss the fact that the coalition's plans for balancing the budget are not all coming into effect now.  They represent the plan for the next 5 years, and, the fiscal tightening does not begin in earnest for another year, at which point we will have not been in recession for 21 months.  One of the more irritating episodes of this problem came with the initial announcement of £6 billion of cuts by Osbourne and Laws.  The papers were full of commentators quoting economists to the effect that what was necessary was a gentle start to any deficit reduction plan, seemingly oblivious to the fact that this is exactly what £6 billion is; whether you call it 6 out of £160 billion, 4% of the deficit, 6 out of £700 billion of public spending, or a 0.8% cut in public spending, this is a gradual start.  These people seem to suffer from a lack of awareness of economics and history and what Keynes was actually dealing with.  In the 1930's he was arguing against an economic approach of seeking to balance the budget during a recession, while the economy was still shrinking.  For someone to refer to a plan to balance a country's budget 5 years after a recession ends as "a return to pre-Keynesian history" suggest an ignorance of economics and history.

The second major hit to their credibility as Keynesians is the fact that pretty much to a man these are the same commentators who loudly demanded ever increasing public spending in the years leading up to the crisis, even though the government was running a deficit of around £30 billion before disaster struck, in direct contradiction to actual Keynesian theory.  Keynes sought to use governmental fiscal policy to smooth out the business cycle, by running a surplus in the good times, and thus cooling demand and the emergence of bubbles, so governments could afford to run a deficit in bad times, in order to help support growth and recovery.  He did not just advocate the idea that never-ending deficit spending on its own was a magical solution to all economics problems.  These commentators supported higher public spending and deficits in the good economic times and the bad economic times.  There seems to be literally no economic circumstance that they believe would not be helped by a healthy dose of central government spending more money and running a deficit.  The fact that these people do not seem to understand what keynesianism actually is, while being quite happy to act as its advocates, is the reason for labelling this Pop-Keynesianism.  What it really is, is a convenient scientific fig-leaf for their real aim, ever higher and more unsustainable public spending.  An ideological colour donned now it is convenient and presumably to be abandoned when it no longer is.  If these people were real Keynesians then they would argue for maintaining public spending for now while outlining their belief and awareness that once the economy has recovered public spending must be restrained and a budgetary surplus run to avoid us getting into this situation again.  Needless to say, they do not do this.    

If these people were real Keynesians then they would have supported the Conservative economic proposals at the 2005 election.  The Conservatives proposed £35 billion a year less public spending than Labour over the period of 2005-2010.  This smaller increase in public spending was shamefully labelled a plan for cuts, and widely shouted down in the media.  This figure is coincidentally just higher than the deficit labour ran until the recession.  Assuming the Conservatives would have followed a similar tax policy to Labour they would have run a near balanced budget, meaning that when the recession came we would have entered it with more than £100 billion less debt, having not artificially inflated the debt bubble further through government stimulus over the last few years, and with considerably more room to manoeuvre to stimulate the economy during the actual crisis.  Not to mention the fact that when the bubble popped that would have been £35 billion less cuts we now have to make.  In retrospect, it is clear that the Michael Howard's spending policy in 2005 was correct and Labour's was wrong, and all the media commentators who slammed the Conservatives were wrong too.

The Philosophy of Christian Focus

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First, a quick disclaimer. This is just some of my thoughts about Christian Focus.  You'll have to excuse me if it is a bit idealistic and theoretical.  I'm not saying we actually manage do all these things.  But they are, rather what I feel we try to do, could do, and perhaps should be trying to do.  And, what we have to offer, as a society, as a community and as part of God's Church.  I'm not trying to tell anyone how to do their job (note to the current exec).  This is just some of my thoughts, I hope it will help people think about what we do and why and how we try to do it.

I feel that Christian Focus, as a society, has something unique to offer, to individuals, to campus, and to the Church in our area.  For me the philosophy of Christian Focus can be summed by saying that we aim to be a Welcoming and loving community to everyone who may want one.  We have two main meetings a week, which, conveniently for this schema, match up with these two ideas, of building a community of people and of seeking to learn from and about one another and the wider world. We are fundamentally open to the world.

For me, these are all the same.  I believe God created all things and loves all things and because of this the Gospel, God's witness to us all, speaks to the whole of our lives, the whole way we conduct ourselves, the way we organise ourselves, both personally, socially and worldwide.  The things we have to offer the community of Christians are similar to those we have to offer our entire human community.

Mother Teresa of Calcutta once said that the worst poverty in the world is not that there are people who have no money, but that there are people who are totally alone, who feel that no-one cares that they are alive.  One of the greatest features of Christian Focus is that it offers a welcome with no conditions attached.  With most societies you have to be able to, or want to, do some activity or be interest in some particular thing, whether rugby, singing, french culture, beer or whatever.  With Focus, though, we have always tried to make it a place where anyone can come, regardless of what they do, or what they are like or who they are, and they will be welcomed and included in the group and accepted for what they are at that moment, without any requirement (you don't even have to eat).  Most basically, to make somewhere where anyone can come and someone will show an interest in the fact that they are alive, regardless of how they're feeling or acting.  And for me one of the ways I have tried to do this, for example, is to just, occasionally, look around at Socials and check that there is no-one sitting on their own with no-one talking to them, especially any new person who may have come in.

More than this though, is to try to build a community of people who know each other and support each other and have fun together and to offer hospitality and rest to whoever comes in.  To make a place that is as nonthreatening as possible so people feel able to come in and take part and get to know people.  The Bible tells us to give to the person who asks of you, lend to a person who asks to borrow from you, and in all things that the person who serves others, God considers master over all, and so we try to attempt to make a space where people can come in to be what they want, not considering it ours, rather than asserting ourselves to get other people to conform to our way of doing things.  Jesus also said "Come to me if you are tired from carrying heavy burdens, and I will give you rest. Take the weight I give you. Put it on your shoulders and learn from me.  For I am gentle and humble, and with me you will find rest.  For the weight I give you is easy to bear, and my burden is light."  So we try to make a place which does this so, as much as possible, people may always leave more at peace and happy than when they arrive.      

To be honest, this is just a posh way of saying making friends and having fun together.  'Making friends' is a simple phrase that means a lot.  Getting to know people, getting relaxed around people,  appreciating people for who they are and what they bring into your life, people who know what's going on with your life, who know how you react, who you trust, without having to explain everything each time you meet.  Enjoying people's company and having fun.  It is such a commonplace thing, but it is also, almost, the most important thing of life.  These are the building blocks of any community, and especially God's Church.  We can solve all the big problems of the world: war, poverty, prejudice; but if we do not build a society where every person is remembered and appreciated and has somewhere to turn in times of trouble then we still do not have much, because there will still be people who are afraid and alone in times of trouble.  Also, part of being welcoming and including without conditions comes a commitment to respecting and appreciating diversity, to all the different possible people that we may meet. You can only offer a welcome to anyone who comes in if you are also willing to respect everyone's difference.  To make a community out of people who are very similar is easy, it is a harder and, hence, a better thing to try to bring together equally people who are different in all sorts of ways.  For me, this is building the Kingdom of God, where the lion will lie down in peace with the lamb, and people from every nation will live together without fear or violence, caring for one another as Lord Jesus cared and cares for us all.

Another part of community is the fact that everything we have as a society, everything we do, we try to share between us and do together.  We eat the same food, we try to make sure everyone can do the activities we do.  We don't try to make a profit from anything we do, we do everything at cost and try to keep the price as low as possible.  We are, as much as we can be, a good socialist community, as the first disciples were in the first days of Christianity, and as religious orders around the world are.  This is all part of standing together and being a loving community that supports one another, whose first aim is to do things together and to help one another, without entry requirements, so that a diverse range of people can be part of it, and in which each person has a place.  St Paul spoke about the Church being like a body, with each cell linked with every other, each organ having a role and a place as part of a larger whole along with every other.  John Donne said that "no man is an island, rather each a part of the mainland", and we try to do this by attempting to bring people from all different groups together, and also appreciating and integrating what every different person brings and the perspective they have and what they like to do, whether music, mathematics, frisbee, photography, football, webcomics or whatever.  

Jesus called his disciples to make disciples of all the nations, and at Pentecost the disciples received the gift of languages to speak to people in their own tongue.  Christianity, for me, is not only a religion for all people, in whatever time and place, but also can never be a religion that attempts to force people to speak with one voice, but rather embraces them in their diversity, as it is that diversity which adds up to give the richness that God created and loves. For me, it is important that Christian focus is a community made up of people from different groups and backgrounds.  This gives us a chance to learn from different people, whom we might not naturally spend much time with, and we strengthen, and compliment each other through our difference, more than we could if we were all the same.  All individuals are precious to God, all are his children, whether Christian or not and Christian Focus would be a weaker place if we were dominated by liberal Christians or evangelical Christians, religious or non-religious people, catholics or protestants, Christians or people of other faiths.  Together, though, we have more to offer one another and more ways to learn about and experience the depth and width of all that God has made.

This idea also motivates our talks, the desire to learn and understand more about the width and richness of the world we are part of and the issues it raises.  They give an opportunity to learn as much as possible about the many different sorts of issues we meet in the wider world, inspired by a Christian perspective.  University is a time to learn and to widen horizons and a wide range of talks gives us a chance to be challenged in many different ways, whether faced with a different religion and way of being spiritual, or the realities of complex moral issues, or the possibilities of new spiritual disciplines and perspectives we hadn't thought of before.  For me, this is about just appreciating and showing an interest in all the world contains.  God made us, and the gospels speaks to us, as creatures of body, mind, heart and soul and at my time at Christian focus we have had talks that have spoken to each one of these parts of our being.  It is dangerous to risk neglecting any one of these areas, as too often happens in our wider society and culture.  

To this end we have talks on many issues, whether intellectual or emotional, or theological.  We also make an atmosphere to discuss issues like these informally between people and, on the intellectual side, we create a chance for people to talk to those at University in other years and get help and advice with work, at times.  Or just reassurance that it is possible to get through your course without going nuts before coming out the other side.  On the side of the soul, We also have Time2Focus, prayer times and various reflections and meditative things.  we try to look at new and different ways to consider faith and spirituality.  We also have food on a weekly basis, though, and we come together to hang-out, to share each other's company, to relax and to end the week in calm.  This just about covers body, mind, heart and soul.  Feeding people is just as important as being able to learn through the talks, or experience community with the people, or take part in new forms of meditation and spirituality or prayer.  Showing hospitality, as simple, as it is, is such a gift and a useful thing in the world, and it is our commitment to this world, as well as the next.

The last thing about Christian Focus, for me, and in line with its diversity and its welcome, is that it is complementary, not exclusive.  Being a part of Christian Focus is entirely compatible with pretty much anything else, and, especially in the life of our Christian members.  We do not try to do everything good or useful for a Christian life, so that we can do the things we do do, better.  For example, Evangelism, spreading the Gospel, telling people about the things God did, and God revealed, in Jesus Christ, is such an important part of the Christian faith.  But we don't do it, at least not explicitly or as a group, because it would appear threatening to some people and reduce our ability to be unconditionally open and welcoming, so we deliberately give up this part of our nature so we are more able to be open.  But it is good that people can then be part of groups, as well, that do do those things we don't.  Different groups and activities and approaches can complement each other and we do not regard that as a problem, but an opportunity to, between us, do more and better than just one group on its own, doing things one way, could.  And, for me, personally, I really like doing different things in different groups, giving me a chance to do things different ways and with different people, rather than doing everything related to my faith through a single church, say, or other group.  This is also all part of the diversity of the thing as well.  We can all do and want to do different things, as Christians and in the ordinary sense, that is fine, because we can agree and come together on certain important things, the importance of pasta bake on a Sunday being one of them.

Excuse me, again, if this all sounds very theoretical.  What it all boils down to, though, is people.  Appreciating, showing an interest in and caring about people.  Beings so precious that God, who is so far above all things, and against whom stars and galaxies and space and time are mere trifles, gave himself over to humiliation and abuse and death to try to save them, in all their messiness and fallibility and complications.  It is, after all, the people who make any community, and whether they care, or are willing to help out, that will make somewhere great or just a pain, far more than any principles or ideas they may be trying to carry out.  
And, as this seems as good time as any to say this, at Christian Focus, over the last three years, I have met the most interesting, diverse, talented and friendly group of people that I have ever met anywhere.  I have to say, that my favourite part of each academic year is the start, because of the excitement about what unique, funny, kind, talented people the new academic year will bring.  It is a source of constant amazement to me that there can be so many people in the world but that each one can be so individual, so different to every single other one, though I guess this doesn't necessarily reveal anything more than my poor imagination.

On a personal note: I have immensely enjoyed my time at Christian Focus, even the year and 2/3 that I spent on the exec, and both the chance to work, relax and live alongside such amazing people.  Over the years the chaplaincy has become a home, and you have become like a family: numerous, argumentative and difficult at times, but always around.  And this has been more and more true the longer I have known you, and we've been around for good times, bad times, exams, holidays, relationships, journeys, illnesses, arguments, and God alone knows how many speakers and how much over cooked rice.  With any luck Christian Focus will continue to thrive for many years to come and have something unique to offer the world, the University, the Christian community, and all its members.

Steve.

Possibly the Most Un-Sexy topic in the world: The true scale of our national debt. - Just how screwed are we?

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The topic of our national debt and deficit has become in recent years one of the most important political issues our country faces. On a party political level it has been and continues to be the battleground of a consistent war between Labour, on one hand, and the Conservatives (and lately the Lib Dems), on the other.  It is an argument motivated by the explosion in the UK government deficit as a result of the recession of 08-09, and the crisis of confidence in government debt that has swept Europe and, to date, most dramatically affected Greece.  It is this issue that has motivated the recent government's emergency budget and the dramatic  package of cuts that will so define British political life over the next few years.

The basic problem is this. Like private individuals governments have to pay interest on their debts, which then sucks up revenue, forevermore, that could be spent on more useful things like public services.  Also, in a situation where market confidence begins to fall the interest rate we pay can start to rise sharply, which means that the costs of debt goes up sharply.  Further, as we are permanently running a deficit and our "loans" are only for about 15 years each, we are reliant on the markets not only to lend us more money (the deficit), but also to re-lend us all our current debt on a constant basis as those 15 year time limits runs out, and if the international market refuses to lend us more money except at a ruinous rate of interest then we could suffer what is basically a cash flow crisis, sending us bankrupt.  This is what happened to Greece before the EU stepped in to save them.  Other problems with ever increasing debts include that, for the above reasons, there is a practical limit on how much debt we can get in, and the more we borrow now the less room this gives us to borrow in any future crisis; and various externalities caused by the state borrowing so much, and hence effectively crowding out the private sector from credit, which then impacts the whole economy negatively.

All these are the reasons why more and more borrowing at the rate we are now, which in 2009-2010 will amount to £160 billion, is unsustainable in the long term.  One important measure of how sustainable this is in the short term, however, is, obviously, how much debt we already have.  You would think that this would be a simple question.  Surely we keep track of a figure as important as this?  The answer is, sadly, more complicated.  There is a figure commonly quoted as our national debt.  This is the figure for Public Sector Net Debt (PSND).  This is the amount of government bonds that have been issued, how much straight government debt is held by outside investors or governments.  However, there are other things to consider as well.  The last 20 years have seen the dramatic increase of what is known as "off balance sheet" liabilities, financial obligations run up that the government will have to pay in future years, but which aren't debt already issued.  Previously, though, there has been no official effort to properly calculate how much these off-balance sheet liabilities come to, until now.

In crude party political terms, the question is: did Labour take a responsible approach during their 13 years in power and leave us with a responsible level of debt, until the recession came along and sadly kiboshed all their plans?  Or, were they, as the Coalition accuses, wildly profligate, relying on fantasies of eternal growth and accounting tricks to avoid people noticing the debt, all to effectively bribe the voters with shiny new schools'n'hospitals in their years in power, but that would leave economic pain down the line?

A few days ago the Office of National Statistics (ONS) released their first attempt to calculate these liabilities (as well as the government's assets) and attempt to construct a full public sector balance sheet, revealing just how large these liabilities are.  This concluded that while the PSND is some £900 billion, the government also bears further off-balance sheet liabilities, previously un-collated, of some £3,800 billion. More than 4 times as much, a truly terrifying total, giving, with the actual 'National Debt', a total for public liabilities of £4.5 to £5.5 trillion.

The Independent ran with the story, with this headline, showing their usual love of pretty pictorial depictions of topics.  I remain amused by the Independent's love of of graphs and pictures. I still can't tell, though, whether these representations are merely a colourful attempt to grab people's attention on the newspaper stands, or whether the staff of the Independent just think their audience are actually stupid, and in fact can't really read.

Either way, the ONS' estimates for our national liabilities break down into:

- Future payments for the state old age pension: £1.1trn to £1.4trn
- Unfunded public sector pensions for teachers, NHS staff and civil servants: £770bn to £1.2trn
- Payments under private finance initiative contracts: £200bn
- Contingent liabilities (e.g. bank deposit guarantees): £500bn
- Nuclear power plant decommissioning: £45bn
- Impact of financial sector interventions: £1trn to £1.5trn
- The PSND: £900 billion (forecast to rise to £1.2 trillion over the next 4 years).

Which figure to go with then?  The relatively acceptable £900 billion, represented by the small coin, or the large, threatening £5 trillion, represented in the Independent's helpful picture by the big coin?  (Though they seem to have failed to add the PSND, making their entire headline semi-nonsense)

The Independent has gone with the most simplistic explanation of the ONS' findings, claiming the report reveals that the National Debt itself is 4 times what we previously thought.  However, in reality the situation is more complicated.  We are dealing with a number of different types of financial commitment that are more or less like the traditional national debt, and are hence less significant for the national finances.  These issues sound subtle but the difference they make is one of trillions of pounds. Sums that are not small beer, not even in the ridiculously bloated terms of bailouts and public sector budgets and national GDP.

The first and broadest issue is the difference between debt and a liability, which if you're anything like me is not something you are at all familiar with.  Basically, a debt is a type of liability. In accounting terms a liability is any financial commitment to pay out money in the future, which you enter into.  Examples include, purchasing from suppliers, debt repayments, taxes, pensions etc.  A debt is a particular type of liability.  A company's balance sheet is a comparison of their liabilities and their assets, which are stuff they own or people's commitments to pay them money in various forms.  A company is considered solvent if they have more assets than liabilities, i.e. if you ran through all the payments they had signed up for they would have any cash at the end.  It is in this broad sense of liability that the ONS has calculated we have £4.7 trillion of them.  This is not the same thing as a debt, though, and this can be seen by taking a quick look through the categories that make up this figure.

1. The PSND = £900 billion.

This is definitely actual debt.  It mostly consists of bonds held by foreign investors.  It has a well-documented rate of interest and strict limit on its maturity.

2. Unfunded Public Sector Pension (teachers, NHS staff, civil servants etc.) = £1 trillion

This is not actual debt held now.  But it is a legally binding commitment to hand over money at a future date.  The government cannot welsh on these promises without serious difficulties.  Mostly consists of the generous final salary schemes that continue to exist in the public sector but have practically disappeared elsewhere.  Government only requires relatively small contributions from its staff, the rest to be made up from general taxation.  This amount has ballooned from £450 billion in the early 2000's to around £1 trillion today, mainly due to the considerable expansion of the public sector.  This, combined with considerable pay rises, both of which push up pensions, has widened the gap between employee contributions and the actual financial commitments.

3. PFI contracts = £200 billion.

Another unavoidable and legally binding contractual commitment.  It doesn't come under the national debt, because it is only a commitment to pay various amounts of money, not an actual debt held by someone else.  In all practical terms, though, the equivalent of a mortgage, and so quite clearly debt.  PFI, the private finance initiative, was one of the  last government's favourite swindles (though in service of impartiality I'm ashamed to admit it began in the dying days of John Major's government).  It effectively meant getting a private company to build a school/hospital/other piece of infrastructure, and then the public sector renting it from them for a number of years, at the end of which, the piece of infrastructure would pass over to belonging to the government.  In practice, this meant the government could commission lots of shiny schools and hospitals now, for minimal cash outlay, only with the string that instead of shelling out £10 million for a school, now, the public sector would pay £30 million over the next 30 years.  This meant that the last government got to wow the electorate with all the shiny things they were building for them, the private contractors got a big wodge of guaranteed income, and the only people who lost were following governments and taxpayers who pay out the vastly inflated costs over the following years and decades.    

4. Nuclear Power Plant Decommissioning = £45 billion.

Again, not debt, but a real unavoidable future financial commitment.  Why the figure is so high, considering how few nuclear power plants we have, though, is anyone's guess.

5. Future payments for the state old age pension = £1.1trn to £1.4trn

This is where it all gets a bit dubious.  Yes, we do have a liability for future state pension commitments.  But, in reality, these are paid out of current government income (taxes).  Ignoring, for a moment, the wisdom of running a general state pension like a Ponzi scheme, in a time of ageing population, these commitments are no different, really, to any other area of state spending.  As Stephanie Flanders, BBC economics editor, said, you could just as easily produce eye-watering figures for the liabilities the UK government is accepting for the commitment of providing everyone with free healthcare into the future.  The difference between the state pension commitment and the public sector pension commitments (or the PFI), though, is that whereas the public sector pensions are legally binding contractual employment commitments, which the government cannot easily get out of, the state pension is effectively a welfare benefit, if a universal one.  This means that the government can increase it, decrease it, postpone the age people receive it, or, theoretically, even abolish it, all as ways of keeping expenses down, at will.  All they have to do is stick the necessary clause in the annual budget.  The same is not true for public sector pension commitments.  Calling the state pension commitments debt is like saying I have a debt for all the food I need to buy in the future.  Realistically I can eat more or less, not eat for a while, or eat cheaper food, depending on my income.  It is a liability in the technical sense, but it is not really the same as actual debt.  If they mean the old-age pension is going to be more and more difficult to fund as the proportion of pensioners in the population rises, then that would be correct.  It's different to saying it is a debt obligation now though.

6&7. Bank Bailouts, deposit guarantees etc, etc. = £1.5 - £2 trillion.

This is even more dubious.  This is the remaining financial risk the taxpayers are exposed to due to the financial crisis interventions.  It is mostly the possible cost of paying out deposit guarantees on banks, and the notional loss currently held by the government holding vast quantities of shares in banks that are currently worth less than the government paid for them.  However, there's no reason to think that the vast majority of this money spent nationalising/propping up banks won't be reclaimed. It's only a risk if the banks are going to default (not likely as that's what the bailouts avoided) or the shares are never going to get back to the price the taxpayer paid for them, and hence the money reclaimed.  Neither of these are likely, assuming the recovery ever actually happens.  Similarly, it's unlikely at this point that the government is going to have to shell out much more on deposit protection.  The ONS is right to say that it does have these as liabilities: commitments to pay money on certain conditions.  But they are not debt, and they will probably never become so.  These liabilities will, in fact, hopefully disappear entirely painlessly in the next year or so.

Out of these 7 categories and the £4.7 trillion of liabilities we started with, only the PSND, PFI, Nuclear decommissioning, and unfunded public sector pension liabilities are really debt in a significant way.  The rest are liabilities in a vague technical sense but not the same as debt at all, like the future old age pension.

Even only including these figures, though, gives us the following amount:
  
£900 billion PSND + £200 billion PFI + £40 billion nuclear decommissioning + £1 trillion unfunded public sector pension commitments + £200 billion (perhaps) of financial sector commitments we're never likely to get back.

............................... = £2.3 trillion      

This is obviously considerably lower than the original figure, but it is still enough to scare anyone without coming up with the type of bogus figures that the Independent splashed all over its front page.

It is possible to be more discriminating still, though.  It is fair to point out that even though I have added some £1.4 trillion of "debt-like" liabilities onto the PSND, they are not actually the same.

Our national debt, as traditionally considered, is money held and owed by outside investors that we must pay a stated rate of interest on, and on which the interest rate may vary with market conditions.  It is the cost of this £900 billion that may sharply rise should the finance markets start to get Greece-like worries about us.  There is no prospect of this happening with PFI payments, for example.  They are set in stone.  It is possible, then, to give three categories of government indebtedness, reflecting this core public debt, the PSND, wider 'off-balance sheet' debt-like liabilities, and wider more general liabilities.  By all means we should have a proper, full cross-public sector balance sheet as well as the traditional 'national debt', more facts never hurt anyone.  But we should still distinguish between, at one end, the broad liabilities we have, at the other end, the current debt we have issued in bonds, and in the middle what is, arguably, really our actual national debt.  These three categories would break down as follows:

Public Sector Net Debt = £900 billion
Wider 'National Debt' = £2,300 billion
General Public Sector Liabilities = £5 trillion.

This approach allows us to have a more realistic debate about the scale of financial problems we are storing up for future generations instead of merely referring to the traditional figure for national debt (£900 billion), which leaves huge financial commitments conveniently out of view, or just referring to all public future liabilities as our 'debt'.  The barmy-ness of this second method is illustrated by the ONS' conclusion that the public sector is solvent.  We have more assets than liabilities (schools, hospitals, aircraft carriers, things like that). This doesn't mean we don't have to worry about the national debt, though, just as these daft inflated liability figures don't mean the end of the world anytime soon.

The Nature and Basis of 'Infinite Responsibility' in Levinas' Ethics

This is one of my recent MA Essays, on Levinas' theory of Infinite Ethical Responsibility.

The nature and basis of 'Infinite Responsibility' in Levinas' Ethics

Emmanuel Levinas (1906-1995) was one of the greatest philosophers of the 20th Century.

Levinas's main concern as a philosopher was Ethics, morality, the way we should act towards and treat one another.  He developed a radical philosophy of love and compassion, based on an overwhelming respect for the importance of the unique value of each human individual.

Levinas' philosophy was profoundly shaped by the reality of the 2nd World War, his internment for 4 years in a Prisoner of War camp and the murder of his entire family in the Holocaust in his native lithuania.  A different man may have surrendered to despair, about the world, humanity or God, but Levinas came out of the experience of the prison camp and the murder of his people with a profoundly optimistic, almost idealistic ethical philosophy.

Against the horror of the vast collectivist machine that sought to eradicate whole peoples, purely on the basis of their race, with total disregard for their lives as individuals, Levinas reacted by building a philosophy that placed the  individual and the encounter of one individual with another as the core moment, the core judgement on which all other thought and philosophy depended.  Levinas put his entire career at the service of  building a philosophical structure that guaranteed the importance, place and dignity of the unique human individual against all attempts to make him or her a disposable means to the larger ends of a group, system or purpose. 

For Levinas, the encounter with another individual was the event against which all other events paled into insignificance.  In the encounter with another person Levinas described the appearance of infinity, of height and majesty, of a thing that could never be fully comprehended.  He described the realisation of an infinite duty to that other individual, based on the infinity within him, that captures you and leaves enthralled by the other person.  He openly talked about building a wisdom of love instead of a philosophy, the love of wisdom. 

 In a century marked by atrocities, collectivist ideologies that judged people by the colour of their skin or their class, and a popular philosophical contempt for the ability and choice of the individual, Levinas stood consistently for the worth and value of individual humanity and created a unique phenomenologically based ethics and critique of the destructive tendencies of human civilisation and thought.