Break the voodoo curse

The IMF has had to rejig its previous optimistic forecast of 0.2 per cent economic growth for this year in Britain, plumping instead for a contraction by 0.4 per cent.

No doubt this is a little embarrassing for the IMF since the conservative coalition government is right to say that its super soaraway cuts agenda is just what the world body ordered earlier.

However, sticking to a failed approach when your economic guru suggests that you think again is not particularly bright, either economically or politically.

The cut-cut-cut obsession of the Tory-Liberal Democrat economic geniuses is reminiscent of the behaviour of charlatan medics hundreds of years ago who could see no further than bleeding their patients.

Failure to effect a cure didn't mean looking for another method. It meant bleeding even more severely, resulting in the patient's death.

That is what faces Britain's economy. Tens of billions of pounds of purchasing power are removed from the economy by hacking away at welfare benefits and workers' real wages.

This reduces demand in the economy, which George Osborne believes can be boosted by an export drive delivered by leaner, hungrier British businesses.

The main problem with this neat solution is that this country's main export markets in the European Union face similar deaths by a thousand cuts, as governments, whether notionally social democrat or conservative, follow the economic orthodoxy, including privatisation, that is the IMF holy book.

International financial and trade agencies have imposed this pattern on countless developing countries as the price for loans.

The results have been invariably similar - penetration of domestic markets by transnational corporations, higher prices, rocketing unemployment and mass immiseration.

The chickens are now coming to roost even closer to home, with the bones of workers in Greece, Spain, Portugal and Ireland picked clean by banking predators and their unaccountable proxies in the European Central Bank and the European Commission.

Our government's only trump card in the current situation is that Britain is not a member of the eurozone and it has a relatively greater freedom of action.

But the Cameron-Osborne-Clegg triumvirate remains fixated with offering "solutions" in trimming welfare benefits from larger families, cutting facility time for trade union reps in the public sector and allowing householders to shoot burglars.

Osborne speaks out of both sides of his mouth, promising that the rich will pay their fair share while defending his decision, backed by the Liberal Democrats, to hand every millionaire a £40,000 present every year from next April.

Every historical crisis of capitalism has shown that governments cannot cut their way out of recession.

The conservative approach has brought about lower tax receipts, higher welfare spending and growing public debt.

Investment in productive industry and quality public services is needed to boost output, meet human need, provide jobs and increase revenue for the exchequer.

There is little prospect of such a change of direction being authored by the current set of multimillionaire public schoolboys running the show.

That makes it crucial that the organised labour movement uses its influence to ensure that Labour frees itself from its own similar, if slightly attenuated, version of the bankers' agenda.