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Tories set youth against the old

THREE years after promising to fix the economy, George Osborne has postponed the recovery yet again.

Boasting in his Autumn Statement of Britain's economic growth figures, the Chancellor forgot to say that these simply show us to be catching up with what other countries have already achieved. But so much is now customary.

Osborne cannot, for he dare not, address the nature of a post-crash society. Even Labour's sound-bite, "the cost of living crisis", is accurate but inadequate. The fundamental assumptions with which generations have been born and raised are being overturned. Their crudest, most obvious symbol is the age at which the state is prepared to provide even minimal help for those who want or need to stop working.

One after the other, burdens are shifted from older people to the young. Osborne, like most politicians, uses the fiction of "the taxpayer" faced with "bills" to hide what is really going on.

In order to "keep track with life expectancy", retirement will be put back to 68 from the mid-2030s onwards, rather than from 2046 as previously promised. In the latter decade, the age "could rise" - meaning "will rise" - to 69.

In other words, those in their 40s will get no state pension until they are 68; those now in their 30s will have to put off retirement until they are 69. By these expedients Osborne aims to "save", according to Treasury calculations, £400 billion over half a century. You could equally say that he is simply refusing to accept the consequences of increasing longevity. Live longer if you wish, he says: the state will take no responsibility, least of all by raising the taxes needed.

This is not a mere philosophical point. If Osborne pushes on with more cuts, as he intends, and achieves a tiny budget surplus in 2018-19, public spending as a proportion of GDP will be as low as it has been since 1948, when the aftermath of the Second World War made austerity a grim necessity. This Chancellor, in contrast, is making a choice born of ideological conviction, abdicating the state's familiar responsibilities as he goes. It is less a question of what a country needs than of what Tories like.

If the UK survives until 2015 and beyond, and if its people decide to vote for a low-tax, low-wage economy with minimal social provision, scant job security and ever-growing inequalities, that will be the people's choice. What the electorate will not be able to choose is the distribution of the burden for keeping such a pitiful socio-economic circus on the road. But Osborne's plans make one thing abundantly clear: younger generations are to pay the price, yet again.

For many, the promise of education as the basis for a life and a career has turned out to be a hoax. Even one foot on the first rung of the ladder of the "property-owning democracy" has become an impossibility. Wages, when they can be had, are lower for each new intake compared with the intake before.

Britain's private pensions industry, among the worst-performing in the world, offers only decades of servitude for pitiful returns. Savings are close to pointless while the Bank of England creates money for bankers. For younger people, as unemployment figures continue to demonstrate, the labour market isn't working. Now retirement is being pushed into the impossibly distant future. Years that ought to be filled with hopes and dreams begin to look like forced labour.

The Tory trick is to turn one generation against the other, to claim that "rich" pensioners - a vanishingly small number are truly wealthy - have somehow stolen the birthrights of their grandchildren; that affluent parents have squandered the gains of the fat years and all those property market windfalls. In truth, if you set aside the way in which one older generation has already been forced to subsidise the younger, you are left with a rewritten social contract, one justified by what "the country can afford".

The advertised need for austerity is being used to mask a political choice. But the Chancellor hesitates to assault the living standards of older people, given their propensity to vote. If he means to make his little revolution permanent, in any case he needs to begin with those who have only lately joined the workforce, perhaps grateful simply to be employed.

But the new fact in all calculations is also the largest fact: the generation obliged to work on until they are almost 70 no longer expects to have the living standards enjoyed by their parents. Unless they inherit wealth - or can lay claim to a trust fund, like Osborne - doors are being closed, one after the other.

Grant the Tories this much: things cost. A decent pension becomes expensive when most people live beyond three score and 10 years. If that's what coming generations want, higher taxes must be the price. It is a price that would be accepted, I suspect, if corporate theft and evasion were dealt with. Politicians refuse to believe it.

The SNP's White Paper, Scotland's Future, is a case in point. On the one hand, it promises to preserve and extend social provisions of the sort being eradicated by Osborne. On the other, it persists with the fiction that cuts in corporation tax - for the likes of Amazon? - will create jobs.

SNP supporters will tell you a lot about the "Scandinavian model". I would add a simple fact: in Scandinavia, they pay for what they get. They don't, for the most part, buy the idea that a low-tax, low-wage economy leads to prosperity. In Norway, which had the wit to create an oil fund, no-one has to worry about pensions. We have, meanwhile, condemned generations to lives filled with worry.

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