“Austerity”: The Demolition of the Welfare State and the Rise of the Zombie Economy

My debut book “Austerity: The Demolition of the Welfare State and the Rise of the Zombie Economy” hits the shelves today, published by New Internationalist.  Below is a hint at what the book is about. At the bottom of the article are links to a few of the fabulous places who have it in stock for you.

004 rushIn July 1944, the soon-to-be victorious powers of the Second World War met in Bretton Woods, New Hampshire. Their mission: to lay down the architecture of the post-War global political and economic systems. They stated that their new idea – neoliberalism – would free the world from fascism forever. In reality, they built the foundations for a new fascism, corporate fascism – and modern austerity is merely a vehicle to deliver it.

Austerity is not a short-term disruption to balance the books. It is the controlled demolition of the welfare state – transferring the UK from a social democracy to a corporate state. We are witnessing the end and not the beginning of a process, set in train at the close of the Second World War, at Bretton Woods.

Beginning as ‘Structural Adjustment’ eviscerarting the economies and societies of countries in the so-called ‘Developing World’ – now, austerity is feasting on the European and North American continent.

Austerity has been presented as necessary, constructive and temporary by governments across the world, the UK included. In reality, ‘Austerity’ is unnecessary, destructive and intended as a permanent break with the traditions of social democracy.

The pillars of social democracy – Law & Justice, Employment Rights, Civil Liberties and Human Rights, and The Welfare State – are being bulldozed, one after the other, under the guise of ‘Austerity’.

In education, successive governments have dissolved the model of state owned schools, staffed by public sector employees.  Today, our children largely attend privately owned schools, where the majority of services in the schools are delivered by private sector staff.  The results have seen costs soar and quality plummet.

A similar model has been used in Health. The Health System is being gutted by endless and costly reorganisations, rampant commercialisation and outsourcing, and unaffordable PFI contracts.

The latest major reorganisation of the NHS, under the Health and Social Care Act, will suck another £4bn out of the health service.  This comes on the back of £780m blown by New Labour on 70 reorganisations in just four years between 2005 and 2009.  Anyone experienced in change management can tell you that this level of change, which does not allow for new systems and processes to bed in or for their benefits to be measured, is simply madness.

The underpinning of any social democracy, is a generous welfare state that ensures citizens finding themselves unable to work through involuntary unemployment, sickness, disability or age receive enough to live in dignity. Our pensioners, our disabled people, our working and jobless poor – all have fallen toward a promised safety net only to find it has been replaced by a bed of nails.

Private companies like G4S have been allowed, by successive governments, to quietly buy up large tracts of our formerly public police, security and justice sector.

It is increasingly likely that if someone commits a crime in the UK they will be arrested by a G4S provided officer, detained in a G4S cell, transported to court by a G4S van driven by G4S officers, the court will be manned by G4S security officers, they’ll be sent to a G4S prison, and released into the G4S probation service to live in a G4S run half way house. All run at a profit, all unaccountable to the public, all free from scrutiny through Freedom of Information requests.

The government also cut £220m from Legal Aid provision, which amounts to slashing the £1bn budget by almost a quarter.  The cut was combined with punitive changes to the rules making it almost impossible for regular citizens to challenge the privatized justice system. Leading Law and Justice Bodies warn will transform the much lauded UK justice system into something no better than a ‘banana republic’.

A raft of restrictions on the right to protest, assemble and express dissent have also hobbled the public’s ability to respond forcefully to such egregious changes.

Meanwhile, the fortunes of the FTSE100 companies is at record highs, Chief Executives are seeing 23% pay rises, taxes are being reduced for or simply not collected from the wealthiest individuals and corporations, MP expenses rose 25% last year and the Queen received a £5m pay rise from the public purse.

This is not a case of poor people suffering austerity while the wealthiest live large.  It is a case of poor people suffering austerity in order that the wealthy live large. It is time to reject outright the politics and the economics of austerity – and instead work together to build a world that works for everyone.


The following retailers are stocking the book in paperback and ebook versions:



Friends of the Earth

Good Reads – you can obtain a free copy if you review.

Guardian Bookshop

New Internationalist



32 thoughts on ““Austerity”: The Demolition of the Welfare State and the Rise of the Zombie Economy

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  3. I just finished this book; we’re reading it at Housman’s bookclub (discussing tomorrow). Really well done. You’ve marshalled a lot of very relevant and connected information and arguments. It has got me riled and ready to do more to work against this ideology.

    • An excellent book pulling together many strands. If I may just add though there is a missing argument: Unemployment benefits actually help the economy rather than putting a strain on it. The benefits are used to buy goods and services thus propping up providers and ensuring that money circulates.

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  5. An excellent article (and book !). I hope you don’t mind, Kerry-Ann, that I have elaborated on some of your ideas, (and pinched some of your choice phrases), for my blog (link below).

    It goes without saying that the tedious and pathetic ”Election Campaign” does not even discuss any of this

    Money itself is a perpetual imaginary debt slavery system, and global central banking is the root cause and engine of all our economic problems.

    Debt Slavery is the totalitarian force to which all parties have surrendered.

    So long as a small group of people are allowed to create money out of nothing and charge interest on it, they will continue to enslave the planet to their ownership, whatever government is ‘’in power’’.

    It is not the party of government that needs to change, but the profoundly iniquitous system itself.


  6. Excellent work. Now, what to do? Firstly I feel the TUC should stop burying their heads or behaving like miserly beggars at a grand banquet : up and at ’em!, all for one, etc.; rally the unions, whose members are are chomping at the bit – stop working for The Man and together storm the centres of capital’s power.

  7. Financial War

    The War Is Here
    Michael La Crone

    Battles over there, nothing to fear;
    Iraq a sideshow, the war is here.
    1929, all over again;
    stock market fraud, now as then!

    Free stock, for Insider bosses;
    2008, 401k losses!
    Bonus gifts, by the millions;
    retirements ruined, by the $trillions

    Corrupt finance, bankers lied;
    war on workers, justice denied!
    Fraud the weapon, bankers deployed;
    public deceived, lives destroyed!

    Bankrupt Detroit, transfer of wealth;
    perfect storm, parasitic stealth!
    Wages earned, shovels digging;
    savings lost, financial rigging!

    Government captured, growing the costs!
    How to stop, the mounting loss?
    Insider claims, investors no voice;
    zero-sum games, rights without choice!

    Betrayed trust, workers’ debt;
    never forgive, never forget!
    Congress feeding, on insider loot;
    Bankers’ finance, fraud at the root!

  8. Saw your interview on the Keiser Report. Max has a habit of leading the conversation so I wondering about a few things:

    1. The private sector involvement in the welfare state is still funded by the tax payer and regulated by the state. In other words this isn’t a private sector, free market system at all, it’s just crony capitalism by outsourcing.

    A real private sector education and healthcare system-unlike the perverted US model which is about as far from a free market system as it is possible to get-would be an improvement. It would be less expensive, more competetive, innovative and higher in quality.

    You don’t adopt that ideology and yet it is clear that the public sector debt is growing whilst standards are falling. The public sector is also more highly paid and commands gold plated pensions that the private sector are paying for. Surely the answer is not to continue supporting this costly, creaking and failing system.

    2. The key problem though is central banks, banking cartels and the control of the money supply. The problems of boom and bust have been getting steadily worse since the First World War, when we went off the Gold standard and accelerated in 1971 when Bretton Woods was vanquished. Any spastically information shows the falling value of money impacting the lower and middle income earners- it’s only the survival of free market capitalism in areas of service and production that has allowed goods prices to fall thus not revealing the true damage.

    Lately QE and cheap money has goosed the asset markets ( I think you said this ? ) which has killed real capital ( savings ) and will shortly kill production. It has allowed the states to continue racking ever more debt in order to continue to finance the welfare system ( which was is not what I believe you Agee with ? ). It has created Zombie financial institutions that the state, it’s politicians and law makers are protecting. The result is losses are socialised whilst profits are privatised. The entire price discovery system of functional capitalism has been bent completely out of shape. None of these fraudulent bankers AND their politician supporters are subject to justice because they are writing their own laws.

    It’s possible to deliver welfare to those who cannot work by means of charity, but this cannot be achieved when a state welfare system is draining capital through taxation. Neither is it possible for business, employment and trade to flourish when we have a state which supports vested interests from all corners of society. The issue of licenses, regulations and other state derived subsidy/tariffs are designed to destroy competition and increase prices for the benefactors.

    Our rights are to earn and keep what we earn by the sweat of our brows and to defend ourselves against our property-which includes our bodies-being stolen away. This is the libertarian non-aggression principle.

    This probably flies in the face of your own beliefs and is guaranteed to get the back up of socialists, but I see some commonality here. It occurs to me that Russel Brand seems on a similar path but lacks the knowledge to see the wider picture.

  9. My gut feeling is that what you say here is correct but the data I’ve seen doesn’t support your conclusion that the Tories and New Labour has dismantled social democracy:

    1. Current government expenditure and transfers (i.e. excluding the sums spent on bailing out the banks) will be almost 50% of the economy. Is your point that in a true social democracy government spending should be significantly higher than 50% of GDP? How high should it be?

    2. Similarly we are told that the richest 1% pay 30% of all income tax; in 2003 the same group accounted for 20 per cent of the total income tax raised i.e. they are now paying a lot more. How is that consistent with the argument that social democracy is being dismantled? Also what proportion of tax should the top 1% pay?

    I ask these question not to troll but because I am very confused.

    Thanks for your thoughts

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  11. As a construction professional, my refusing to work on PFI contracts eventually cost me my job.
    “Principles help me sleep at night”
    I believe I have witnessed a ” social experiment” over the past 15yrs, what troubles me is; many never realised they were the victims.

  12. Pingback: Kerry-anne Mendoza: ‘Austerity: The Demolition of the Welfare State and the Rise of the Zombie Economy’ | Creators not Consumers

  13. I don’t know if you cover this in your book, but the real agenda here is to impoverish the lower and middle classes to the same level as the poor in third world countries. The ultimate goal is to create a one world goverment, a 90% reduction in population and a system of debt slaves controlled by and for the needs of the global ellite.

    The plan is almost complete, last year it was said that in 2015 Barrack Obama would be the man to bring in New World Order.

    The plan was created a few hundred years ago and has been passed down through certain banking families who have organized and executed their plans through controlling government, creating war and creating artificial fear through terrorisim. The terrorism you see today is not real, real terrorists would not target super markets or cartoonists, they would target power stations, transport networks, millitary posts, government offices.

    The people are being lied to in the UK, the news you see on TV and in Newspapers is just for entertaiment and properganda purposes. The powers to be control the media and control public opinion through the media. The truth is out there but you won’t find in on the BBC news channel.

    There is very little we can do to stop this now, but what you can do is make sure you never go into debt. Debt is their way of controlling and empoverishing us. Just look at what has hapened to student loans, the brightest young people are been saddled with huge debts.

    Be careful what you eat, avoid toxins and poisons in food and water, many dangerous ingredients are been added to our foods that cause cancers and brain damage. Avoid MSG, Aspartame, Genetically Modified Ingredients and others.

    Be careful of vaccinations, most flu vaccinations in the UK contain Mercury a serious brain toxin, we’re told it is used as a preservative, really?

    There should be no carsnagentic, toxic or poisions added to any products used by humans full stop.

    Formaldahyde is a well known carsnagenic, but it’s added to all shampoos, conditioners and even baby bath in the UK. Apparently it is added to make our hair shine, really? Formaldahyde is a serious nero toxin and it simply destroys our nerons and central nervous system. You won’t see the word formaldahyde on the bottle it appears in over 30 different chemical names.

    Your GP may perscribe anti depresents or anti acids, please note many of these release formaldahyde during the breakdown process of these drugs in the human body. There is much evidence that these drugs lead to brain damage, memory loss and demencha. I have first hand experience of this when I could not read a page in a book and understand what I had read even when I read the same page 20 times. I couldn’t remember any passwords for bank accounts and online services, my whole world came crashing down. I stopped taking my medication because I just kept forgetting to take it and three months later my memory problems disappeared. There are doctors in both the UK and US who have been exposing the truth about these medications. I didn’t understand how I could think properly again, the only thing that had changes was that I no longer took perscription medication. I did a google search for anti depressants and brain damaged and found there were more studies proving that anti depressants caused brain damage and sysptoms of demencha than there were supporting the benefits of such drugs.

    There is only one way to stop this and that is to get rid of our central bank, the bank of England. This is the one reason and only reason why UK government has debt and the sad thing about it is that the UK government has the ability to wipe out all our UK debt in less than 24 hours. All they need to do is to take away the right of the central bank to print money and instead print money themselves. The government could print enought money to pay off all our so called national debt in less than 24 hours. Pay off the Bank Of England and start printing interest free money. The Uk government are unlikely to do this because the last leader of a country to do this was JF Kennedy and he was killed because he signed an executive order allowing the US government to print and issue interest free money for the benefit of the people. When you understand how the banking system works, you understand how and why we got to where we are today.

    Each pound in circulation is created by a debt, no money exists in the UK economy that was not created by debt, but the interest demanded by the banks is never created, which means there is never enough money to go around. As a result business will always go under, houses will always be repossesed, there will always be unemployment. There will always be loosers in a system which is designed to create a situation where there is never enought money to go around.

    Get rid of the central bank and the corrupt government and set the country free.

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    • My argument is that the institutions of neoliberalism and the ideology began at Bretton Woods – which is self-evident given the mechanisms which delivered it were agreed and established there. This article is speaking about the implementation of it and misses out a chunk which I cover in the book between 1944 and where the article picks up.

      • Fair enough, I need to read the book I think but most British people’s memory is of what looks like a golden age from roughly 1945 to 1975: the welfare state, the postwar consensus which was assaulted by neoliberalism with the election of the Tory govt in 1979. But then we just called it Thatcherism.

        • Yes, we’re agreed on that. But what we didn’t see was what was happening elsewhere prior that that. The bigger picture helps people understand how this policy operates globally.

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  16. Could you make the ebook available for sale at Amazon US? I’m really interested in reading it, and I am sadly dependent on my dear friend Mr. One-Click. Thanks!

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    • Sadly not, the meta-data goes out and is picked up by whomever wishes to platform it. You can of course choose to buy from someone else (who pays their tax!)

  19. I feel relieved someone has spoken the truth it is beyond comprehension what is going on with the money boys. I hope you have got over the loss of your pussy cat my wife and I felt deeply for you.

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