There is only one way to get out of this and it is the one way that a socialist Government will never take, with the exception of New Zealand in the 1980's where Rodger Douglas saw the light where their economy was very similar to ours, with high taxes at about 40% of GDP and falling real wages. He saw what dynamic growing economies like Hong Kong did and decided that was the way forwards, it was nicknamed Rogernomics, once Labour were out of power this was followed by Ruth Richardson with Ruthanasia, but it was the exact opposite as it transformed their economy into a dynamic growing one, where ALL the citizens gained. Where farming subsidies and market price interference was scrapped, the farmer to this day would not go back to the old system as they find with their complete freedom to decide what to grow they now make more money, when it includes their lower taxes as they no longer cost the Government money.
It is no accident that Western society was much richer that the USSR or that China was virtually bankrupt with much starvation before their market reforms. The way to have a dynamic economy is to get rid of intrusive regulation, vested interests and crony capitalism, which we are currently suffering overload from the UK Government and the EU and cut Government spending to 20% of GDP or lower. This is why China, South Korea, Singapore, Hong Kong, New Zealand and others are rich countries. The Western world like the UK are in decline through below world average growth and many like the UK are flat lining or worse. What they have in common is tax rates at about 40%, intrusive Government regulation in all areas of society, and it kills economic growth.
It is not a magic formula and if you want to read more about why the Industrial Revolution happened first in the UK and not elsewhere to what other successful economies have done, then I would recommend a book that has only just been published and I have just finished reading called "Heavens on Earth - How to Create Mass Prosperity" by J. P. Floru who is a senior research fellow at the Adam Smith Institute.
If you want this country to continue to slide into poverty just continue voting ConLibLab where they are all socialist parties and will continue our economic slide toward the living standards of Greece, Cuba and North Korea.
All the sensible rats like me are leaving the sinking ship, just make sure, if you stay in the UK, that you have your own life raft at the ready.
To show how complacent people are, this confiscation of between 6 and 10% of deposits in Cypriot banks has been talked about for the last 6 to 8 weeks as part of the rescue by the EU and goes to show that if you were part of the smart money and had transferred it into Gold, Silver, a German bank account or put it under your mattress, you would not be facing this haircut on the majority of your money. In these troubled times it pays to be vigilant and ahead of the curve. It is going to be interesting to see how much capital flight there is from the other PIIGS from tomorrow onwards, where money has been drifting back to them on a lack of bad news. This Cypriot bailout has set a very dangerous president.
The flat lining and slight dips don't make much difference to our economy and are within the realms of noise, error and also decreasing North Sea oil. The Government's increase of North Sea Oil taxes which reduced exploration, which they have now reversed, means they scored an own goal here. Taking the effects of the North Sea Oil decline out means that our economy maybe growing a bit, but with the Governments fiddling of inflation figures, it is difficult to tell.
What we do know is that taxes are increasing with the revenue from income tax and NI due to increase from £151bn this year to over £200bn by 2017 which will take about 0.7 out of the economy each year for the next four years. So with growth now reduced to 0.7 for this year and 1.5 for next and these may well still be far too optimistic, then the best you can hope for is stagflation and stagflation.
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Topic: Recession (Read 903 times)