The basis of a democratically elected government is to serve the interests of the whole of society, regardless of who voted for it and regardless of any special pleading by particular groups. Its main duties are to protect its citizens against both external and internal threats by maintaining an appropriate national defence capability and welfare state, and to maintain a functioning economy.
I am aware that there are many who would argue with these duties. Most but not all would agree that national defence is necessary. To those who think not my own view is that we enjoy freedom today only because our ancestors fought and died for it, and to maintain it we must be prepared - and be seen to be prepared - to fight and die for it again. Those who are not prepared to fight for freedom become at best the servants and at worst the slaves of those who are prepared to fight for domination - see the freedom conflict in the Introduction.
Many, particularly hard-line neoliberals, disagree with the need for a welfare state. UK governments since 2010 seem at best to be half-hearted about it, and appear to feel that the 2008 financial crisis compels them to scale it down significantly on the basis that 'we don't have the money'. Money was shown in chapter 10 to be merely the lubricant that releases pre-existing wealth-creating capacity, so this argument doesn't hold water. Perhaps what they mean is that society no longer has the resources to maintain a properly functioning welfare state, and sadly there is some truth in this, because society's resources are increasingly devoted to providing the investment returns that private investors demand - things that make money - regardless of whether they create wealth, as was argued in the Introduction. Private investors aren't interested in social benefits; they can only afford to be interested in private benefits, so as more and more resources are turned over to serve private interests fewer and fewer are available to serve social needs.
In responding to the events of 2008 in this way it is deeply ironic and shameful that the weakest and least responsible for the crisis are forced to forego financial support when those who caused it are permitted to keep and even enhance their £millions. The Liberal Democrats' part in the process between 2010 and 2015 is all the more disappointing when it is recalled that one of their greatest leaders and social reformers - David Lloyd George - introduced the welfare state in the form of old age pensions and national insurance, and perhaps their greatest visionary, William Beveridge, was the architect of the modern welfare state.
In 1942 Beveridge declared that 'there are five giant evils on the road to reconstruction: poverty, disease, ignorance, squalor, and idleness' (Beveridge 1942). To defeat those giants he proposed social security, a national health service, free education, good quality social housing and full employment. The Labour Government under Clement Attlee, with great courage, set about making his vision a reality in 1945. The more that society is starved of resources the more likely it is that those giants will return.
This is what Paul Krugman (winner of the 2008 Nobel Memorial Prize in Economic Sciences) said in 2012:
The austerity drive in Britain isn't really about debt and deficits at all; it's about using deficit panic as an excuse to dismantle social programs.[319]
A welfare state represents no more than insurance against life's hazards. We are all at risk and unless an individual is wealthy the consequences can't be borne without help. Insurance represents an agreement between those at risk to share the costs of making good any individual's misfortune. Individually we can't afford the consequences but collectively we can. We are used to insuring against major damage to our possessions, so why should welfare risks be any different? The difference is that the wealthy resent paying insurance premiums when the beneficiaries are predominantly non-wealthy. But the wealthy only have their wealth because it has been provided predominantly by the non-wealthy, so the premiums they are asked to pay are fully justified.
With regard to maintaining a functioning economy the arguments that rage relate to how government should carry out this function. Neoliberals believe that apart from maintaining law, order and property rights it should keep out of all markets, leaving them free to operate without restraint. But players in unfettered markets always operate within their own limited sectors; none operates at the level of the economy as a whole. Yet nevertheless neoliberals believe that the economy as a whole will prosper. They have searched long and hard to find a mechanism that benefits the whole economy from the pursuit of individual self-interest, but without any success. The search is discussed in the next chapter. Nevertheless their faith is undimmed. They believe that everything that society needs will magically appear. It really is a belief in magic because there is no known mechanism that can make unrestrained markets work in society's best interests.
Other economists believe that government has a vital role to play not only in regulating markets so that they do benefit society, but also as a provider of social needs where the market is unable to do so. There is no magic involved in these beliefs, just plain common sense and pragmatism.