‘no magic money (tree)’: justification for austerity

The governments who embrace neoliberalism—a political approach that favours free-market capitalism, deregulation, and reduction in government spending—sometimes justify economic austerity policies by arguing that there is no magic money (tree).

This has recently resulted in a remarkable concordance between the former British Prime Minister on the one hand, and the French President on the other, who, independently from each other, each used the term when confronted by a nurse.




On 2nd June 2017, during an election 1 edition of BBC1’s Question Time, the British Conservative stateswoman Theresa May (born 1956), then Prime Minister, faced a question from a nurse, Victoria Davey, confronting her over the 1% pay increase received by NHS staff. Theresa May defended the government’s decision to cap pay rises for public sector workers by saying there was no magic money tree:

I’m being honest with you, in terms of saying that we will put more money into the NHS, but there isn’t a magic money tree that we can shake 2 that suddenly provides for everything that people want.

1 The general election was held on 8th June 2017.
2 cf. history of ‘money tree’ and ‘to shake the money tree’

However, in Is there a magic money tree? Yes children, there is. But that’s the wrong question, published in The Guardian (London and Manchester, England) of 6th June 2017, Ellie Mae O’Hagan explained: 

In the context of May’s statement, a “magic money tree” seems to be a euphemism for “the means to pay nurses properly”. Well, in that case, of course there is a magic money tree. And we all know it, if we’re honest with ourselves.
Does anyone who has witnessed the pomp and circumstance of the Queen’s Jubilee, the funnelling of public money into Syrian airstrikes, or the systematic cutting of taxes for the rich really think we’re not paying nurses properly because we simply don’t have the money? Absolutely not: we don’t pay nurses properly because the government makes a choice not to.

Furthermore, under the terms of the Agreement between the Conservative and Unionist Party and the Democratic Unionist Party on support for the Government in Parliament, signed and published on 26th June 2017, the Democratic Unionist Party (DUP)—a Loyalist political party in Northern Ireland—negotiated an extra £1 billion in spending for Northern Ireland in exchange for supporting Theresa May’s minority Conservative government.

In addition, it is interesting to note that, in 2016, the Conservative government had awarded the Queen a 66% pay rise to fund a £369-million 10-year refit of Buckingham Palace—leading Labour Party and Scottish National Party politicians to question why the monarch was getting so much more money at a time of austerity.




When he visited the CHU 3 of Rouen, in Normandy, on 5th April 2018, Emmanuel Macron (born 1977), President of the French Republic since 2017, was confronted by a nurse over bed and service closures; his answer was:

Y a pas d’argent magique
There’s no magic money.

3 CHU: centre hospitalier universitaire, i.e., teaching hospital

This made Pascal Riché write the following in Les soignantes de Rouen et le péché originel de Macron (Rouen nurses and Macron’s original sin), published in L’Obs (Paris, France) of 6th April 2018:

Emmanuel Macron est victime d’une des premières mesures de son quinquennat : avoir offert, sur un plateau, près de 5 milliards d’euros aux Français les plus riches, à travers la suppression de l’impôt sur la fortune mobilière 4 (actions, obligations…) et l’instauration d’une douce « flat tax » sur les revenus du capital. Comment répéter de façon crédible qu’il n’y a plus d’argent en caisse quand on en a si facilement trouvé pour satisfaire ceux dont le train de vie est le plus prospère ? Idem concernant les cheminots : comment dénoncer les prétendus « privilèges » de travailleurs gagnant souvent moins de 2.000 euros quand on a choyé les Français qui « s’enrichissent en dormant », comme les appelait Mitterrand 5 ?
Emmanuel Macron is a victim of one of the first measures of his five-year mandate: to have handed on a plate nearly 5 billion euros to the richest French, via the abolition of the tax on moveable wealth 4 (shares, bonds…) and the introduction of a mild “flat tax” on capital income. How can you credibly repeat that there is no money left in the state coffers when you have so easily found some to satisfy those whose lifestyle is the most prosperous? Likewise regarding the railwaymen: how can you denounce the so-called “privileges” of workers often earning less than 2,000 euros when you have indulged the French who “grow rich while sleeping”, as Mitterrand 5 used to call them?

4 In 2017, Emmanuel Macron abolished the ISF (impôt de solidarité sur la fortune, i.e., solidarity tax on wealth), and replaced it with the IFI (impôt sur la fortune immobilière, i.e., tax on real property).
5 The French Socialist statesman François Mitterrand (1916-1996) was President of the French Republic from 1981 to 1995. He introduced the IGF (impôt sur les grandes fortunes, i.e., tax on big fortunes) in 1981. Abolished in 1986 by the right-wing government (1986-88) of Jacques Chirac (1932-2019), the IGF was re-established in 1988 as ISF after François Mitterrand’s re-election.

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