We all know that times are tough. The Welsh Assembly Government has had to make some difficult decisions, but has tried to defend front line services, and by that, I mean the things that matter most. The Government in London, however, are intent on slashing things that mean a lot to people all for the sake of pleasing those who support them.
The last recession was caused by a dramatic fall in Government incomes right across the world following the bail out of the banks during the banking crisis. Because people were not paying tax, shortfalls appeared. Gordon Brown's Government, along with several others around the world, bailed out the banks in order to avoid a complete collapse. The alternative would have meant people having all of their money wiped out, much the same as happened in the 1930's.
The aftershocks from the global crash are being felt now. The British Government's income is still not as high as it could be, not as high as it was for most of the last decade and not as high as it needs to be in order for us to afford all the things we want. In situations like this, there are always choices. And we are currently seeing the Conservatives and Liberal Democrats making the wrong one.
The Tory approach has always been to let the market make the running. In that they may be wrong, but at least they are consistent. David Cameron and George Osborne are simply pursuing an extension of Margaret Thatcher's unpalatable economic medicine that was so despised at the time and didn't work then. It succeeded in making millionaires out of a few champagne-quaffing City dealers, while hard working families had to deal with job insecurity, house prices spiralling and the massively unfair Poll Tax. Here we go again!
The Liberal Democrats, however, should know better. If you believe anything they have said for the last twenty years, that is. They have constantly talked about investing in the economy, making education a priority (remember the 1p on income tax to fund education?) and delivering services for those who need them most. Now that they are in the grip of politicians who would be better suited to being Conservatives, all this has been casually forgotten. George Osborne speaks, Danny Alexander and Chris Huhne tug their forelocks. It's worth recalling what John Maynard Keynes, the great liberal economist said in his work "Essays in Persuasion" about a Conservative-led coalition in the 1930's. He said: "They offer me neither food nor drink, neither intellectual nor spiritual consolation." Present day Liberals would do well to take note rather than blindly following the Tory lead.
So is there an alternative to letting the market decide? Of course there is. We have two contrasting economic policies which have given dramatically different results. When Alistair Darling was Chancellor, he cut VAT, introduced policies such as the car scrappage scheme and put in place policies to help people get back to work. As a result, the economy started to grow again. This meant that more people were working, businesses were making money again and the Government income started to look healthier. If this happens, libraries stay open, meals on wheels get delivered and young people receive the financial support they need to attend college. In the US, pursuing such policies, 3.5 million jobs have been created since President Obama came to power. Here, the Conservatives, however, have pulled away the ladder that Alistair Darling built just to satisfy their political ends, such as the scrapping of the Future Jobs Fund. the Welsh Labour Assembly Government will therefore bring in its own Welsh jobs fund to create 4000 new jobs during its next term in office. The Conservatives, however, would prefer the figures to look good straight away in order (as they see it) to get elected next time around. As a result, support has disappeared for the economy, investment has been slashed and the economy is shrinking. Businesses are going bust, unemployment is rising and Government income is dropping. And what is the result? Libraries close, pensioners don't receive their meals or cannot turn on their heating and young people cannot afford to go to college. Rocket science it certainly is not.
So what can we expect from the immediate future? Well, unless the ConDems perform a dramatic U-turn, more of the same. Unemployment will rise, services will be cut and more misery will be heaped upon already hard-pressed families. I'm not holding my breath. Thankfully, here on this side of the border, Labour in the Welsh Assembly has the opportunity to soften the blow for ordinary, hard working people.
The last recession was caused by a dramatic fall in Government incomes right across the world following the bail out of the banks during the banking crisis. Because people were not paying tax, shortfalls appeared. Gordon Brown's Government, along with several others around the world, bailed out the banks in order to avoid a complete collapse. The alternative would have meant people having all of their money wiped out, much the same as happened in the 1930's.
The aftershocks from the global crash are being felt now. The British Government's income is still not as high as it could be, not as high as it was for most of the last decade and not as high as it needs to be in order for us to afford all the things we want. In situations like this, there are always choices. And we are currently seeing the Conservatives and Liberal Democrats making the wrong one.
The Tory approach has always been to let the market make the running. In that they may be wrong, but at least they are consistent. David Cameron and George Osborne are simply pursuing an extension of Margaret Thatcher's unpalatable economic medicine that was so despised at the time and didn't work then. It succeeded in making millionaires out of a few champagne-quaffing City dealers, while hard working families had to deal with job insecurity, house prices spiralling and the massively unfair Poll Tax. Here we go again!
The Liberal Democrats, however, should know better. If you believe anything they have said for the last twenty years, that is. They have constantly talked about investing in the economy, making education a priority (remember the 1p on income tax to fund education?) and delivering services for those who need them most. Now that they are in the grip of politicians who would be better suited to being Conservatives, all this has been casually forgotten. George Osborne speaks, Danny Alexander and Chris Huhne tug their forelocks. It's worth recalling what John Maynard Keynes, the great liberal economist said in his work "Essays in Persuasion" about a Conservative-led coalition in the 1930's. He said: "They offer me neither food nor drink, neither intellectual nor spiritual consolation." Present day Liberals would do well to take note rather than blindly following the Tory lead.
So is there an alternative to letting the market decide? Of course there is. We have two contrasting economic policies which have given dramatically different results. When Alistair Darling was Chancellor, he cut VAT, introduced policies such as the car scrappage scheme and put in place policies to help people get back to work. As a result, the economy started to grow again. This meant that more people were working, businesses were making money again and the Government income started to look healthier. If this happens, libraries stay open, meals on wheels get delivered and young people receive the financial support they need to attend college. In the US, pursuing such policies, 3.5 million jobs have been created since President Obama came to power. Here, the Conservatives, however, have pulled away the ladder that Alistair Darling built just to satisfy their political ends, such as the scrapping of the Future Jobs Fund. the Welsh Labour Assembly Government will therefore bring in its own Welsh jobs fund to create 4000 new jobs during its next term in office. The Conservatives, however, would prefer the figures to look good straight away in order (as they see it) to get elected next time around. As a result, support has disappeared for the economy, investment has been slashed and the economy is shrinking. Businesses are going bust, unemployment is rising and Government income is dropping. And what is the result? Libraries close, pensioners don't receive their meals or cannot turn on their heating and young people cannot afford to go to college. Rocket science it certainly is not.
So what can we expect from the immediate future? Well, unless the ConDems perform a dramatic U-turn, more of the same. Unemployment will rise, services will be cut and more misery will be heaped upon already hard-pressed families. I'm not holding my breath. Thankfully, here on this side of the border, Labour in the Welsh Assembly has the opportunity to soften the blow for ordinary, hard working people.
