Via the TaxPayers’ Alliance, this video explains vividly that the Government is spending £22,218 every second.
In this week’s MoneyWeek, Merryn Somerset Webb’s editorial is titled “Slash spending and taxes”. She refers to Dr Tim Morgan’s work which explains that the economy has for too long been dependent on private borrowing and public spending and that, now these are “dead in the water”, 70% of the economy is incapable of growth.
I have previously explained that this Government will be increasing cash spending and taxes, increasing the national debt and keeping the state living beyond its means through at least 2015-16. That’s the plan.
Webb refers to Morgan’s point that state spending rose 53% between 2000 and 2010 and that “No one has yet explained why the British state must somehow spend about £700bn today having managed perfectly well on £450bn (at today’s values) ten years ago.” She writes, “So we should really slash spending and also slash taxes — to get growth moving too.” It’s an easy message when you are not on the doorstep, or on a public platform, with families straining under the weight of taxation, looking for that something back for all they have paid.
Too true. Bank for International Settlements Working Paper 300 The future of public debt: prospects and implications includes the following chart of public debt to GDP projections for much of the western world:
Now that was produced in 2010 and the Chancellor has moved things on, but even their best case scenario is dire. We face, in our lifetimes, profound choices about public spending. As I have said in presentations given many times, the evidence is that for forty years politicians’ promises have been covered by currency debasement. Sound theory suggests currency debasement fundamentally caused this crisis, along with a number of important secondary factors.
So, why is public spending so hard to cut? Why have politicians allowed this mess to overtake us? Here’s one answer:
What is to be done? Rebuild civil society to meet many of our needs. Decentralise power. Ensure the state lives consistently within its means and with the backing of the public too. All this is in the Coalition’s programme. What’s missing is reform of the broken monetary system which made this systemic economic and social crisis both possible and inevitable.
That’s why we founded The Cobden Centre.
The question is, what kind of government shall we have? One which fosters balanced, lasting prosperity founded on production, saving and investment? Or one which makes deceitful promises of easy riches and fulfils them temporarily through the traditional, insidiously destructive mechanism of inflation?
I look forward to the budget next week…