In a televised interview this morning, Liz Truss, currently awaiting the result which may well see her chosen as the next Prime Minister of the United Kingdom states that she is aware that her proposal to cut taxes would proportionally benefit the rich more than the poor; an approach she defended by saying that she believes that to “look at everything though the lens of re-distribution… is wrong”.  She went on to say that “I am about growing the economy, and growing the economy benefits everybody”.  This statement is either incomplete or wrong, and the two statements together show just how little she understands either the English language, logic, or economics… (or possibly all three!)

Firstly, ‘growth‘ can be measured in a number of ways, from the utterly arbitrary method which calculates base GDP to the a method which adjusts for both inflation and population size: so without further elaboration the phrase is completely meaningless.  Yet even where we use a measure which adjusts for inflation, the measure remains an expression of a change in economic activity, and it does not measure the benefits that may (or may not) be brought about by such activity.  This is true even where one takes the even more generous per-capita income.  All of these measures completely fail to account for the standard of living in the country in question, and therefore the value of any potential ‘benefit’ is open to debate and cannot be said to be necessarily positive even where growth is.

The suggestion that considering everything through the lens of re-distribution is wrong, is in point of fact; completely incorrect when we are talking about everyone benefiting: and this is the point that Liz Truss was trying to make.  Yes, an empirical assessment of the value of an economy can be made through GDP (and hence growth) but in order for a determination to be made about how this benefits everyone, then everyone’s situation must be evaluated – and it therefore follows that the benefits must be distributed across society for there to be any hope of this occurring.  Seeing as how those people out of work and receiving support from the state cannot experience ‘growth’ other than directly from government policy, as is also true for government funded institutions such as the National Health Service, schools etc. etc. – it follows that a re-distribution of growth is a pre-requisite of everyone benefiting.

So… is Liz Truss a liar?  Is she ill-informed? Does she simply not understand the words coming out of her mouth?

Whichever it is, I have the distinct impression that the UK is about to swap one politician of this ilk for another…

Isn’t it about time that we stopped thinking of money (be it GDP, or growth or income or whatever) as intrinsically good, and instead looked at how we use it?