Austerity Posterity

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Okay, this is you've reminded me of something that is a real bug bar of mine.

What is that?

It's like

it essentially means it really bugs me.

Just in case.

But A bugs me.

No one knows this.

Mary's Irish.

Welcome back to The Dream.

I'm Dan Gallucci, filling in for Jane Marie this week.

For most of my life, if I was going to have a conversation about wealth inequality or our lack of social services in the U.S., those conversations were with people who had a similar interest, and there weren't a ton of them.

Nowadays, it really wouldn't surprise me if anyone came up to me and started talking about wealth inequality.

It's obviously affecting more people.

All you have to do is look at the average annual income from the year 2000 to the year 2023.

In 2000 it was $76,000.

In 2023 it was $76,500.

And during that time, inflation rose 80%.

There are more billionaires now, and the billionaires have more billions.

In 2017, we cut taxes for the rich, and we are about to do it if we pass Trump's proposed Big Beautiful bill.

Thankfully, I have a friend named Mary O'Hara who agreed to come in and talk to me this week.

She's written two books on the subject of poverty, and we're going to be discussing her first book, Austerity Bites.

I'm really happy she's here today to help us parse through some of the reasons for this growing income disparity.

Mary, thank you so much for coming on the show.

We're really happy to have you here.

Hey, Don, good to be here.

There's a lot to your history going back to your childhood.

I'll just quickly say having grown up in Northern Ireland during the Troubles in a very impoverished community couldn't have been easy.

But you were able to

get a full scholarship to Cambridge.

And I want to talk to you about what happened after, because it's all relevant to the discussion we're about to have.

So can we start there and talk about

your life post-college?

Yeah, so I went into journalism relatively late compared to a lot of people.

I was in my late 20s when I went into originally as a the first gig I got was as a financial reporter Not something I thought I'd be remotely interested in, but turned out to be an education that helped me when I did start doing the sort of journalism I really wanted to do, which was around social policy, social justice.

So understanding the economics and the backdrop to that suddenly became really important.

I was a staffer at The Guardian for well over a decade, then had a regular column there.

And so I've written across the whole sort of spectrum of poverty, social justice, disability rights, and the impact that governments and policies have on these marginalized groups.

And that's kind of been a thread now for a solid 20 years.

You eventually moved to the U.S.

and have been in Los Angeles for a bit.

And you continued to write for The Guardian.

Oh, yeah, I had the column here with The Guardian for, oh, maybe seven years.

And that was called Lesson from America,

very much to try and sort of unpeel the culture around the issues that I'm interested in.

So not just writing news stories, reporting on poverty, for instance, but asking, why is it like this?

And for me, one of the major parts of my work over all these years has been talking to people who aren't policy people as well.

I love a good nerd, but the people who really understand these issues are the people who are living them.

And so a lot of my work has been rooted in sitting in people's living rooms or community centers and talking to them about their life and how these policies impact them.

So austerity bites.

Yeah, it came out in 2014.

In the immediate aftermath of the financial crisis, the UK's reaction, UK government's reaction at the time, was shocking really, because they just ripped the social safety net apart, having had a relatively robust welfare state since the Second World War.

And it was unprecedented, the level of cuts to public services, to people's social security benefits, et cetera, et cetera.

So it was happening so fast that I was just on the ground, traveling to all kinds of places around the country, Scotland, Wales, England, and Northern Ireland, and investigating basically, talking to people about what the new government approach was doing to their lives.

And I was doing video, audio, print, just getting the stories out as fast as I could.

But I had way too much material to put out in those small segments.

And so I went to the University of Bristol Policy Press in England and said, Look, is there a way that we could create a legacy product from this reportage so that it has a life beyond these initial reflections?

So they were totally up for.

So I did extra interviews as I went along, and it became basically a chronicle of what had happened during that initial aftermath and the government's approach to dealing with the financial crisis fallout.

Yeah, so when I think about austerity measures in the UK, I also think about Thatcher in the 80s.

We had the same thing here with Reagan.

What was different about these austerity measures that were put in place post-financial crisis?

And as you're traveling around and talking to people, how different?

were these austerity measures?

And I guess why was it so important to put the book out at that point?

Aaron Ross Powell, I mean, you know, I'd been reporting on social policy for a while, but it was a real rubican that had been crossed.

The amount of pain that people were expected to absorb was extraordinary.

So it felt right to create something that, you know, people could get from their library or

teachers could use as a tool when people wanted to understand in aggregate, in real time, what was happening.

And

the paperback version came out a year later in 2015 and even in that year I had to update a load because so so much more had happened.

And one of the aspects of that entire

time was not just that the policies were cruel and unnecessary, and that they affected minorities and marginalized groups the most, but it was the language it was wrapped in.

I'm assuming you're talking about the media and government.

If so, what was it?

What was different in the way they were kind of couching these ideas?

So it was sold to the public in a very particular way, which meant that the public would feel that the government had no choice but to do this.

And it just so happens that the people affected are actually lazy scroungers.

And after the second edition came out, I spent a couple of years writing about these subjects again, but more and more it seemed to me that there was a cultural as well as a political angle to this.

And the fact that the wider public would so readily accept narratives about people that were patently untrue or exaggerated, and that they would endorse policy on that basis, even with the evidence that people were hurting, even with the evidence that food banks were suddenly ballooning.

So when I first started, I went to food banks.

There were barely any in the UK before austerity.

And now like millions of people rely on them.

That's such a weird thing to hear because food banks for a long time, they were one of the only ways to actually get resources to people who needed needed them in the United States.

Yeah, and we knew that.

I mean, in Britain, we would look at the US and go, how the hell do people survive?

You know,

why isn't there a basic provision for families to have non-stigmatizing access to food?

Right.

So it really was a cultural earthquake in the UK when it people began to become aware that suddenly our safety net had been shredded, shredded rapidly, and that we were becoming more and more like the U.S.

in terms of our approach to welfare.

I want to back up real quick.

Your book is called Austerity Bites, and austerity isn't a word, I guess isn't a word that we use very often in the U.S.

So can you lay that out?

for the listeners?

What does austerity actually mean, at least in this context and in the title of your book?

Yeah, well, I think, I mean, austerity is one of those really adaptable words that's used in many contexts, right?

So people are aware that austere means pared down, right?

It means stripped down, for instance.

So

we have a sort of common understanding of the meaning of that word.

But austerity as a policy is a very specific approach by governments, right?

So I'm going to read the Collins dictionary definition because I think it's probably the most succinct one that there is.

Basically what it is, is difficult economic conditions created by government measures to reduce a budget deficit, especially by reducing public expenditure, right?

So essentially what that means is a government will pull money out of its economy through massive cuts to the public sector in the deluded notion that that will fix their budget deficit because they've reduced spending without for a moment contemplating that actually

maybe consider investment, maybe consider taxing the rich rather than bashing people who are already in difficulty.

Because gee whiz, what happens when they follow this approach?

The very things that they're warned about, that it is not effective.

It never achieves the goal it's set out to achieve.

And therefore, it's basically ideology as it's applied by governments wrapped in the facade of economic policy.

And inevitably, the poorest are hit the hardest.

The middle classes also take a bit of a hit because wider services are affected and the rich get off scot-free because they don't use these services.

They might get a bit pissed off when they can't find police officers because they've been cut or there's potholes in the road.

But other than that, it's really something that affects poorer people.

So, after the financial crisis, when governments around the world were trying to deal with the various fallouts from it, everything from house prices, you know, to grocery prices to whatever, there were ripple effects that went across the globe.

At a time when people needed resources more

governments ever heard specifically people.

But not every government government chose the route of austerity.

So what happened in Britain, for instance, is when the global economy started pulling itself out of the

financial crisis, the UK had like the slowest growth rates.

Keching, you know, you were told that that's what was going to happen,

but still went down that road.

And

we're feeling the ramifications still.

Aaron Ross Powell, Jr.: How loud was that voice then?

I mean, because here, almost every four years, you'll have

at least a presidential campaign that will nod to inequality.

How big was that voice in opposition?

Well, I mean, not big enough.

I mean, I wrote in Austerity Bites about how the labor opposition were just so slow off the mark on this.

Academics were warning about it.

Social researchers were warning about it.

Community activists were warning about it.

The people on the receiving end of these policies were warning about it.

But it took the opposition a long time to even use the word word austerity really I mean I'd be looking in newspapers and going why is no one mentioning this and then gradually say through 2013 14 15

people began to wake up because when I was first doing the research it was the very early days by the time you got to 2015 Those policies were beginning to have an impact on the ground.

People were feeling it in their pockets, right?

People were feeling it by ending up homeless because they couldn't afford to rent and stuff like that.

So it was a very slow burn, despite the fact that the cuts themselves that were introduced were brutal and fast.

And that's part of this, right?

With any austerity measure or any budget cut when it comes to social services, the effects are something that are going to be felt for a long time.

I mean, they already are felt in various ways,

the impact.

It was a slow burn reaction to challenge in it, with the exception of the disability community, really, because disabled people were absolutely aware immediately of what was happening and were among the first people to take to the streets and protest.

You know, they were the canary in the coal mine for everybody else, because they were feeling it almost immediately.

And

the media took a while to catch up.

The right-wing media didn't want to catch up because they didn't want to, they just wanted to pretend it wasn't happening anyway and were too busy labeling people as, you know, scroungers.

But when you think that the Conservative government had done this, and an election happened four years after they started doing it and they were re-elected, you know, which was

kind of mind-blowing because by that point people were beginning to see the effects like food banks ballooning and stuff like that.

But it was an unprecedented time because of the financial crisis.

Like a lot of governments around the world were unsure about what to do or what was going to be the best approach.

The kind of people that most government officials don't listen to.

Don't listen to, right?

And so, you know, there were things that were happening that just took time.

And then once they started hitting the headlines and people started looking at what was happening in terms of wages, in terms of wealth inequality, the ballooning number of billionaires, and not only in number, but in their actual wealth, suddenly people are going, oh, okay, so what's happening here?

So you're telling us that we can't afford for ordinary people to go about their ordinary business and to pay people proper wages, but somehow the economy can sustain a number of billionaires.

People just start going, what?

How does that make sense?

We'll be right back with more from our conversation with journalist and author Mary O'Hara.

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Welcome back.

Now more from my conversation with journalist and author Mary O'Hara.

We touched on this earlier, but I'm wondering if I'm correct in my thinking that these austerity measures didn't just come out of nowhere, that the path the UK was on when Thatcher was elected, and then subsequently the almost mirrored path the US was on when Reagan was elected in the 80s.

Well, it was a parallel policy path, really.

So, you know, you had Ronald Reagan in the States, in Britain, there was Margaret Thatcher, and they were like bosom buddies, right?

They were both products of the 1970s move toward neoliberalism in the sense of reduce the state, you know, reduce the state, reduce the power of trade unions, privatize everything you can privatize, deregulate everything that you can deregulate.

And that gave birth to everything that came after, the fertile ground for the financial crisis, the

idea that the way to fix a country's problems is to take away even more of the safety net.

They were all birthed during the 80s, really.

And I mean, we saw what happened in America, you know, trade unions were decimated, basically.

Private membership of trade unions in this country just free-falled.

Now, when you bear in mind that some of the trade unions were in a large part responsible for growing wages in the aftermath of the Second World War, then that's a, you know, that's a strategic hit.

The people who were thinking about how they could reshape the economy, reshape politics, knew that if they took out the unions, then that would be a major loss of solidarity, of people coming together to find solutions to problems.

It becomes much harder to find solutions to any of these problems.

if you've fractured the groups that would normally be responsible for pushing for better conditions for workers.

So you've taken out one of the major drivers of

a journey toward equality.

Not just taken it out, but demonized it.

I grew up in a union family, and

there was never a point where unions were anything but positive.

I've been in unions.

They're not always fun to be in.

Yeah, me too.

But for the most part, you know, my family wouldn't have gotten to where they were without a union.

But I noticed that in the 80s and the 90s, as unions started to decline in their relevance, they were also being demonized in this way, talking about the corruption.

What they had been asking for

was now starting to cripple the economy.

Aaron Powell,

one doesn't exist without the other, right?

You can't eliminate

societal force for progress without demonizing it.

If you don't demonize it, it just gets on with what it's doing, which is making people's lives better.

So one, you have the objective, which is to diminish the power of workers and of organized workers.

And then the other is the method that you use to deliver that objective.

And one of the methods that you use to deliver that objective is to demonize the people who are standing up for workers' rights, who are standing up for your average citizen.

And if you do it effectively enough, then it really helps you break the unions much faster.

Now, no one's saying that unions didn't have problems or that they were, you know, clean as a whistle.

There's always been issues.

Any large organization will have problems, right?

That's it.

There's no idea.

But what we do know is it's the best that we could come up with as a society to further workers' rights.

No one at the top just hands things to the people at the bottom, right?

They don't.

I mean, philanthropists might say they do, but they do it in a very specific way.

But you don't get it by asking for it and you don't get it by waiting for it.

You only get it by acting to make it happen, right?

And that means putting pressure on politicians, on industry, on corporations to do that.

And the most effective route we found was unions.

And so if you track the growth of unions anywhere in Europe, in America, anywhere, it tracks with rising wages,

reduced inequality, which is why that post-war period between

1945 and let's say 1980, because that's when Reagan got elected just for the sake of simplicity,

was an enormously unique period in human history.

Nothing like it had ever happened before.

The Industrial Revolution didn't bring wonderful equality to people.

It saw workhouses and people being worked to the ground, right?

So it was an incredibly unique period in time.

And it took two world wars to get to the point where working people could actually claim what was theirs.

You know, there was a general sense of a forward trajectory.

But for some people, that wasn't what they wanted, right?

And they wanted the old status quo.

You know, there's a reason elites are elites.

It's because they manufacture it.

And

the one time in history where we were able to manufacture better conditions for workers and greater equality was anathema to these people.

So then we end up with the fight back.

And the fight back was forensic and targeted and strategic.

And it worked.

So, you know, the services that we rely on for, say, kids and care are are older people who,

you know, may have health issues that get slashed.

Everything was being slashed, right?

And so, obviously, we have the National Health Service, which when the last Labour government was in, was ranked as probably the top health service in the world, went from that to being on its knees, right?

So think about it.

If you've got older people, for example, who need care from local social services, from local government, that could be someone coming around and helping them with the cleaning or any of the meals on wheels, any of those sorts of tasks, or checking in on their health and making sure they're okay.

If those people don't get those services, where do they end up?

In the hospital, right?

So, everything is a separate issue, but everything isn't a separate issue.

But because they slashed everything at once, almost everything at once, the pressure on the system was propulsive.

It was an extraordinary thing to do.

Aaron Powell, it is vicious by its very nature that people want to retain a certain amount of wealth while other people are suffering.

It's inherently violent, right?

So austerity is a violent act against your own population.

I mean, and there are physical, including death,

outcomes to this.

If that isn't violent, I don't know what is.

But there's another level to it, which is almost complicit violence by not challenging the system

that could help alleviate those problems.

So if someone's sitting on a big metaphorical stack of cash, right, if you visualize it like that,

there is no one who can make an argument to me that sticks, that says this is morally or ethically justifiable.

It isn't, you know, it isn't.

Okay, so what happens then?

Like when the unions are being completely marginalized and the politicians, especially the ones on the left, because the right are basically just enacting the policies that they ran on, but neither are advancing the quality of life for people in the bottom 50 to 80 percent of the population.

It just seems normal to me, I guess.

I don't know if normal is the right word, that people kind of put their heads down and just try to get through the day because it doesn't feel like there's any sort of representation that's going to help.

It can obviously feel like voting doesn't matter and that things are just going to be difficult no matter what we do.

Right.

There's like a hell, there's a skepticism.

Yeah.

And

the weird thing about that skepticism is A, it's awful, but B, it's entirely logical, right?

So

if the federal minimum wage in this country is exactly what it was, what it is it now, 14 years ago, 15 years ago maybe, and in that time you've had democratic administrations, you can forgive people for going, what the hell are you doing for me?

Because this means that any employer can say, oh, I'm paying the federal minimum wage.

Look at me, aren't I great?

Even though inflation has altered dramatically during that time period, everything costs more, including rent, right?

So you've got that on the one hand.

Then on the other hand, the system has already screwed you so much that you've got your hands and feet tied.

So culturally, people are having a deeply logical response to a very clear situation.

You can't afford to not just get your head down.

work your three jobs, try to pay off your debt, even though you probably never will.

When you've created a society like that, you've literally cut off at the knees the potential for people to challenge that system.

Ally that with the amount of money that swirls around in lobbying and politics, then the power imbalance is so great that, again, it's a logical response for the average person to go,

This system just screws me no matter who's in power.

I can understand that.

But then the other thing that happens is that cold realism gets exploited by people who then go,

if they figure this out, they're going to know it was us that did it.

So we got to find some people to put the blame on.

And so all of these things are all intertwined.

And I mean, if you're coming from the perspective of social good shouldn't exist, well, you know,

you're looking at a pretty good space right now.

Because of course, if you are going to start blaming other people for these issues, then immigrants.

come to the forefront.

And we're speaking right now from Los Angeles on Monday, June 9th, 2025.

We've had a bit of a weekend.

We've had a bit of a weekend, but that tension has been building up for a long time.

Yes, because scapegoating is a fantastic sport to these people, right?

That blaming, that scapegoating

is helped along quite nicely, thank you very much, by our media ecosystem, where we've ended up in a land of silos, right?

So we've got fewer community spaces.

And alongside that,

the media system changes and social media becomes suddenly extremely important

and we become silos within silos within silos and it's it's it becomes it turns out very easy to manipulate people algorithmically and with the right person in front of the particular microphone because people are usually having their first reaction is usually entirely logical which is the system has screwed me the question then becomes who goes into that space and tells them why that's happening right and if you're being told that why that's happening is because single moms who are trying to feed their kids are like you know trying to get snap benefits or it's immigrants who are coming in and air quotes stealing your jobs well they'll find the enemies to point the spotlight at to distract from the fact that of course none of those people are to blame for the crisis that everybody's in what was always interesting to me was that america for such a long time boasted about it being a nation of immigrants and a melting pot.

It was a a mark of pride, right?

Whereas I grew up in the UK, where the British were losing their colonies around the world, and, you know, and there were problems with immigrants coming in from the Caribbean and the former colonies, that stoked riots, etc., etc.

But I think one of the things that kind of breaks my heart with the US is that something that was a mark of pride has been so toxified and so inflamed.

What I was discovering with austerity bites was that as inequality grows even wider, the loud voices trying to distract you from it have to become louder too, right?

At the same time, we've got a budget bill going through Congress that would ostensibly wipe out some of the most important safety valves for people.

You know, Medicaid is under attack, et cetera.

And we see a sort of upsurge in that rhetoric blaming people, you know, for nothing that they have have caused you know

this sort of particular wave of attacks on the poor has been i think among the worst i've observed in a long time so you get statements like that little gravy train is getting ready to run out 70 of people on medicaid are in work right you know and most of those who aren't are either old disabled or in school but they paint it as if everyone's just sitting there waiting for handouts when of course the rail handouts are going to the the rich because the whole point of this particular bill is to actually do that.

They're not even hiding it, right?

It's to sustain tax cuts for the rich.

When we're in a situation where

like a lot of people voted for that,

that's really heartbreaking.

We'll be right back with more from journalist and author Mary O'Hara.

Welcome back to my conversation with Mary O'Hara, journalist and author of the book Austerity Bites, which had its 10th anniversary edition come out in the fall of 2024.

So I think getting back to the question I was asking earlier, what happens to us, like emotionally, psychologically, from a societal standpoint, when we're facing what feels like insurmountable odds and we're trying to ask for the most basic necessities for people who need them?

How does that change us?

There's a lot of really interesting psychological research out there around what happens to the human brain when a person is in extreme poverty or is having to meet a lot of these challenges all at once.

And our brains alter, right?

How could they not?

And our stress responses are very different, but it's about more than that, right?

So it's not just about getting by, you know, as much as that's a noble goal.

Like the question becomes, how do we live lives?

that are enriched.

So I've interviewed people who would talk about how just getting that that little bit of help means that, let's say, they can do a course online.

So they can get some qualifications that means they can get a better job.

But if they got assistance in the first place to make that maneuver, then down the line, what comes, the benefits of what comes is really quite incredible for that family, for the kids in that family.

Because turns out that if you help people, they actually get on with the business of making their lives better.

And it makes it harder for you to demonize them.

But this is one, okay, this is, you've reminded me of something that is a a real bug bar of mine.

What is that?

It's like

it essentially means it really bugs me.

Just in case.

But a bug.

No one knows this.

Mary's Irish.

But a bug bar like just gives it a little bit of emphasis to say it more than bugs you, right?

Yeah.

It becomes like an obsessive thing.

And for me, it's the framing and communication of good stuff when it happens.

So

Democrats here, and the same goes for Labour Labour in the UK, are really, really awful at blowing their own trumpets when they have created policy that has good results, that has helped people's lives.

It's almost like, we don't really want to talk about that because it's just going to get shot down as like socialism or something like that.

Well, the only way people are going to understand that these policies are a good investment and that they work is if you shout it from every rooftop you find, right?

If you don't let people know what it it becomes so easy to undermine them, right?

Because then someone comes in and goes, this is a wasteful policy.

It costs X trillion dollars.

And if you use the term investment, people think differently about the word investment, say, versus welfare.

And that's my other big bug bar is why welfare, which is such a great word, because it's about, it's the kindest word, right?

It's like animal welfare, human welfare.

I mean, who could argue against welfare?

It's great, but it turns out you can.

But that's only really possible because,

you know, the left it doesn't claim welfare as a good thing it is a good thing for our society for our collective welfare to be looked after and fostered right i don't know how you argue with that but that is my bug bar is that even when good things happen albeit slowly they don't communicate it well they don't shout about it and then they open themselves up you know If I'm looking for shreds of positive,

it's the fact that we have the evidence that when certain policies are given a chance, that they do improve people's lives.

But I think the direction of travel isn't great if this is what we end up with.

Because for someone today, like you and I would know people, lots of people who are technically in professional jobs,

you know, highly educated, highly experienced.

But they still don't have any financial security.

We do know a lot of people.

A lot of people, but that's the vast majority of people that I know.

You know, whereas 30 years ago, the people who you might have identified with who were struggling would have been regarded as solidly lower working class.

It was a subset of a subset.

And now it's just almost everyone, really.

So that's what I'm saying.

Like the direction of travel is what worries me because how do we get equality back?

I don't know.

But I do think people are more conscious now maybe than they were 10 years ago because the obscenity of the wealth differences now is so off the charts.

Well, in the meantime, all the things that have kept us in a place where it is difficult to think beyond just what we need to do to get through the day are only going to get worse.

Yeah, I think it's interesting that the term

that springs to mind is a military strategy term, right, which is shock and awe.

And this is a societal equivalent.

And we're all kind of reeling, I think, if we're honest.

Yeah.

But that's not to say that objectively there aren't things that can be done, that there aren't arguments to be made for why something as

all-invasive as inequality needs to be addressed.

I mean, you know, and there are some politicians who speak very well on this.

And that it, you know, it is a moral issue.

If I was a religious person, I would certainly be looking at it through that prism.

I think the new Pope is looking at it through that prism.

You know, it's interesting that he's talking about those things too.

So, I think there are ways to talk about it

and practical things that people advocate for.

It's just that we're all frustrated that we can't change everything right away.

Yeah,

but that's never been the case in the whole of history.

Thank you so much for coming on the show today.

Well, thank you for asking me.

I can't even remember anything I said.

Well, I think, yeah, we're just trying to figure it out.

That's all.

And it's going to take a long time.

We're all just trying to figure it out.

And we're not just going to be able to figure it out right away.

It's going to take a long time, and we're going to have to see the effects of all this

come to fruition over the course of many, many years.

Yeah, but that's why people like me, you know we rumble around and try to figure out what we can and collaborate with others and build a body of information and evidence that helps us think about it and you know i don't know that's the best that i can offer

thank you mary thanks dan

The Dream is a production of Little Everywhere.

I want to thank our guest, Mario Herrick, for coming on the show.

Go buy her books.

They're amazing.

Austerity Bites, obviously, which we were focusing on today, 10th anniversary edition is out now.

And also a book called The Shame Game about the psychological impacts of poverty.

We'll be back next week.

Hey dream listeners, it's finally here.

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