Romney gifts the election to Obama, and unwittingly highlights the Western economic dilemma

The stupefying video gaffe from Mitt Romney may nevertheless make some people think harder about employment

The general feeling shared by those with a degree of discernment (and an eye to his previous behaviour) has been, for some time, that Mitt Romney is really nothing more than just another greedy neocon working to complete the privatisation of American government.

In one of those potentially election changing moments, last night later on (BST) a video of Romney mouthing off about the idle unemployed “the 47% of Americans who pay no tax” came to light and went viral in no time flat. Across the US media set, the general view as I write (it’s been a long day involving different time zones) is that either the GOP dumps him and drafts another candidate, or the election is now Obama’s to lose. It’s hard to disagree with that.

Both the percentage used (and the “no tax” jibe) are bollocks – another urban myth that the numbers deny from pretty much every angle. But like him or loathe him – and personally I can’t stand the bloke or his ideas – he does have a point, and Conservative politicians have made exactly the same point in the UK…also with some justification.

A left-of-centre Party in any major democracy enjoying a welfare system is always at a ‘dependence’ advantage, in two ways: first, they pay the salaries of around 1 in 6 of those in work who are Government employees; and second, they pay out benefits to those stubbornly economically inactive folks who represent a staggering 3 out of ten of all adults aged 16-64. In the UK, for example, that gives the Labour Party a much higher chance of allegiance from some 41% of all voters.

Those tonight calling Romney every name under the sun are probably right to, but not on this issue necessarily: Ben Bernanke made it clear in his QE3 address that he feared a growing number of Americans were joining the ‘structurally unemployed’ – what we in the UK call LTUs – long-term unemployed.

The sad reality is that it suits the Democratic and Labour Parties to have lots of poor folks thinking it’s damned unfair they’re not one of the rich folks. But even assuming either of those Parties have the calculated desire to ‘breed loyalty’, Romney was a prize ass to have said what he said at a public gathering – whether it was behind closed doors or not.

So that’s enough being nice about Mitt: I’ve had my long-held view that he’s a tax-dodging, simplistic bigot sort of confirmed by this, and I cannot help enjoying a wry smile of expectation about how Dan Hannan will talk his way out of the revelation. However, I do think an interesting economic point has been raised here.

As I mentioned last week, on the two occasions the British Coalition government has introduced welfare rationalisations and cuts, around 175,000 previously inactive people suddenly became active again each time. And nobody – but nobody – can deny that a massive influx of Polish workers into the UK that began eight years ago all found paid work…despite the existence of over 1.5 unemployed Brits even then.

I think that what’s being demonstrated is the fundamental flaw in both the libero-socialist and neocon outlooks. Left of centre governments increase unproductive bureaucracy and make life better on welfare than their Right wing opponents. Having 2 in 5 people contributing nothing to the economy (and a further 1 in 10 retired) means only half the population are engaged in keeping the show on the road.

However, what neocon claptrap has done is (a) make fewer people far more wealthy, (b) increase the pool of unemployed, and (c) reduce the real wages of the ‘squeezed middle’ between those taking the piss at the top, and those muddling along with a workless existence at the bottom.

Thus between them, the fluffies and the nasties have made it well-nigh impossible to get an economic recovery kick-started. Hence Ben debanker pumping dollars out all over the place. And Mervyn King. And Mario Draghi. And all to little or no effect.

I reached the stage late last year of realising that the unwillingness of the Establishment Parties and bureaucrats to recognise this obvious problem meant that sites like The Slog would be whispering in a thunderstorm at 3am when nobody’s around to listen anyway….assuming they wanted to in the first place.

I keep on churning out this stuff purely to get a larger and larger number of opinion formers and leaders interested in the idea of radical constitutional and economic reform before it’s too late, and the Barbarians sack the legislatures. But really, I still believe the best way to effect lasting change is to make life difficult for those who hold the real power in both the US and the UK: the civil servants, the bankers, the multinationals, and the media.

For what it’s worth, I’ve just put up a new page called AIMS that enumerates the key things I’d like to change. Pay it a visit and see what you think.

Related: Socialists and Neocons divide and rule