This week is going to be a really fun week. It started off well with Liam Fox admitting that there won’t be any fast jets to put on the Royal Navy’s two new aircraft carriers. On cue, a group of the country’s ‘leading businessmen’, their shoulders twitching in anticipation at the thought of the gentle touch of the dubbing sword, today published a letter in the Telegraph supporting the forthcoming cuts and declaring that the private sector would easily be able to mop up any job losses in the public sector – yeah right!
Now Dave and Georgie O, the boys from Slough Grammar, armed with a whole eighteen months experience in the real world of work, are about to extinguish the last flicker of recovery in the economy and condemn millions of people to decades of poverty.
Of course the deficit needs to be reduced, nobody would argue with that, but there are more creative and intelligent ways of going about it. I have suggested a ‘Solidarity tax’, a specific tax for a specific problem, fair and easy to implement. Why is the coalition so fixated on spending cuts? Are they devoid of any imagination? Have they really thought through the consequences of their actions or is this an opportunity to roll back the state that they just couldn’t resist?
The fun is really going to start in a couple of weeks time when markets start to spiral downwards as confidence leeches from the economy accelerated by the effects of the retrenchment in government spending. PwC have already forecast that the number of jobless is likely to rise by a million, the welfare costs of this over four years will be £20 billion. With no positive action on stimulating growth in sight, the cuts are going to create more problems than they solve.
Whether you are in business or politics, if you dish out medicine you have to give a tonic too. Medicine without tonic means the patient takes longer to recover – a lesson we have failed to learn from the Thatcher cutting spree. With no tonic in sight, there are very tough times ahead.