Quote:
Originally Posted by Hugh
Each journey begins with a single step.
If we don't get the structural deficit under control, the interest rates on the national debt will be higher, thus accumulating more debt (and our debt interest bill is £2.3 billion per month at the moment) - this view is supported by some august and influential financial bodies such as the IMF, most of the City of London, and the International Credit Ratings Agencies.
One small, but very important, fact - Although public spending will be £43 billion higher in 2014/15 than it is this year, it will £30bn lower than planned by Alistair Darling. George Osborne is aiming to cut Labour's planned increases in spending rather than initiating actual absolute cuts in the public spending totals to be totally accurate.
btw, you do know that the forecast total for public borrowing of £167 billion for 2009/10 mentioned in the Labour Government March Budget was in fact more than every single Labour government had hitherto borrowed in history, so I don't think continuing in that vein was sustainable, do you?
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I like the "each journey begins with a single step" because on the countless occasions I have heard it used, in my life, I have often stated that providing it is in the right direction
The IMF, The City, are international bankers and financiers and their interests may deviate from the populace as the IMF in particular is interested only in balance sheets irrespective of human consequences. The City has been of interest to me for decades and their interests are short termism and profit driven.
ICRA's have given the thumbs up to far too many USA created complicated schemes for creating debt out of debt that have gone bust. They hold the international standard of credit rating but IMO have a low credibility rating, not that it matters what ordinary folk think.
I do not care what Labour had planned because we are where we are and judgement can only be based on the way forward. Looking backwards or projecting would of, should of, could of scenarios are irrelevant. One comment.... of course the way we were going had to be changed as it was unsustainable.
In the run up to the election I was dismayed by a choice of dumb, dumber and dumbest (con, lib, lab) and when the outcome was known I thought "here we go again, 70' and 80's with a vicious deflationary twist". We are adopting the Canadian model which was used to very painful but good effect from 1993 to 1999. It worked for them because the most vigorous period of global growth started and ended during their grand experiment (1992 to 2000). We need the same burgeoning global growth but there isn't a snowballs chance of seeing it.
The busy young men on a mission have embarked on a route for the country at possibly the worst time in recent history and if any historic parallel was to have been drawn then liquidity reduction, at a bad time, was the USA 1930's model.
I may be and sincerely hope that I am overly pessimistic but I have little faith in politicians and fear of those who are driven individuals.