Past Labour governments have ended with a sterling crisis and a borrowing headache. It looks as if this one wants history to repeat itself.
Today we are to be told that the government needs to spend and borrow more to help us out of recession. It is curious, when we are also told that we are in the current mess because we have borrowed too much. This crisis came about because the Western Central banks and regulators decided to call time on too much lending. It’s a topsy turvy world.
So let’s get this straight. The government wants the private sector to lend and borrow much less, because it has overdone it. Once the effects of reducing borrowing come through, the government will then borrow more on our behalf. They will use the cash they borrow to prop up private sector companies and banks that have suffered from withdrawing the private borrowing, and to replace the activity and jobs which the private sector used to provide, with public sector ones. Anyone left in a productive job or with savings will have to pay more in tax to pay the interest and meet the repayments on the much enlarged government debt.
In the meantime many people who had worked hard and saved a lot will see the value of their pension savings, their homes and their businesses smashed. Some will be changed from being independent and successful to being bankrupt or unemployed, and dependent on the state. No longer able to live off their work or their savings, they will live off benefits.
Can someone explain to me why this is progress?