The divide is becoming clearer as each day passes. It is:- borrow
and spend and pay back for generrations; or rein in expenditure to
leave room and resoiurces to work our way out of recession fuelling
this from savings.
I would prefer the second alternative to be greatly 'beefed-up' with
actual cutbacks and will continue to advocate this but there is no
doubt that, when it comes to the choice, which is the better.
xxxxxxxxxxxx cs
Other papers have comments on this too and I will collate these as
the day goes by.
===================
TELEGRAPH 6.1.09
1.David Cameron makes a bold promise to savers [Leading article]
In the words of David Cameron, the prudent have become the "innocent
victims" of the credit crunch. They have seen their thrift punished
as returns on savings and investments plunge.
Meanwhile, those who helped inflate the credit bubble by taking on
crippling levels of personal debt are being encouraged to start
borrowing and spending again, even as the Government showers billions
on repairing the damage caused by excess debt. In this Alice in
Wonderland world, it is little wonder that those who save to spend
rather than borrow to spend, many of them elderly, many of them our
readers, feel so aggrieved.
In bringing forward his really quite dramatic tax proposals
yesterday, Mr Cameron has addressed that sense of injustice with
boldness. He wants to abolish income tax on all savings for those
paying basic rate tax while at the same time raising the tax
allowance for pensioners by £2,000. The move is every bit as
significant as the increase of the inheritance tax threshold to £1
million announced in September 2007 and which helped scupper Gordon
Brown's early election plans. Its effect is to make every savings
account an unlimited ISA for basic rate taxpayers. It has the beauty
of simplicity and equity, no bad measure of fiscal policy, and more
than meets the demands of our Justice for Pensioners campaign.
But Mr Cameron has done more. He showed yesterday he has found the
right rhetoric to explain how he intends reining back the
unsustainable levels of public spending initiated by New Labour. He
would fund this £4 billion of tax cuts by restricting the growth of
spending in most government departments to 1 per cent a year, while
sticking to existing expenditure plans on hospitals, schools, defence
and international development - so deflecting Labour's parrot cry of
"Tory cuts".
The package also means the "do nothing" smear which ministers level
at the Tories at every opportunity will ring even more hollow. More
important, the Tory leader is tapping into the public mood. There
cannot be a family in the land which has not been reassessing its
finances. Mr Cameron's call for a shift "from an economy built on
debt to an economy built on savings" will strike a resonant chord.
This is an important step in the right direction which will, we hope,
lead to even more radical measures to limit the reach and cost of the
state. Clearly, Mr Cameron is in no position to enact these measures
- yet. It is not, however, unknown for Labour to steal the Tories'
best policies. Well, there's a Budget in a few months - and these
plans are well worth pinching.
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
2. Morality is making a comeback, and that's bad news for Gordon Brown
Our 'son of the manse' Prime Minister always believed hehad an
advantage denied to lesser mortals, but the tide appears to be turning.
By Iain Martin
Gordon Brown would have made a great minister of the Kirk. He is the
embodiment of the Church of Scotland in which his father preached
with Presbyterian distinction: sparing of too much of the God stuff,
heavy on the communitarian emphasis on moral authority and interested
in the interminable troubles of Africa.
To say that Brown is a "son of the manse" is an epithet, compliment
or insult (take your pick), with no equivalent in England. Attached
to it are notions of academic striving, exemplary achievement at an
early age and pressure to "do good". On its own this can often breed
a middling to serious moral superiority complex, but in the case of
the young Brown it was combined with another influence which
accentuated the tendencies already developed by upbringing. He came
to maturity in time for the birth of Thatcherism and what he regarded
as its wicked attack on all he cherished most: collectivism, hyper-
active government, higher taxes and public spending.
The broad Scottish Left of which Brown was the young star in the
1980s was, even by its own low standards, particularly pompous and
self-satisfied in its proclamations of imagined moral superiority
over the English. In 1989 Brown even penned the definitive tract of
that movement: Where there's Greed: Margaret Thatcher and the
betrayal of Britain's future.
Those, then, are Brown's roots and here is why they will matter this
year: morality is making a comeback but not in ways which are to the
Prime Minister's advantage.
The idea of Brown the up-standing moralist, cultivated by the man
himself, is being attacked in blistering fashion and he does not like
it much. Under the cover of Christmas, Bishops in the Church of
England mounted an extraordinary assault on Brown, using separate
interviews with The Sunday Telegraph to preach damnation of Labour's
record. The Bishop of Manchester accused the party of being "beguiled
by money" and "morally corrupt".
This followed the treatment meted out by Number 10 to a perfectly
reasonable critique of the PM's self-styled rescue plan from the
Archbishop of Canterbury, with Dr Rowan Williams asking whether it is
wise to cure a crisis produced by an excess of borrowing with ever
more borrowing. For his pains, Dr Williams got a lecture from the
Prime Minister featuring the tale of the good samaritan, proving how
stung Brown is at being attacked on ground he has thought for most of
his adult life his own: the field of morality.
This development has coincided with an evolution in the attitudes of
David Cameron. In recent weeks, the Tory leader has become much more
outraged by the scale of the economic catastrophe engulfing Britain
and has started to consider that its origins are not only economic,
they have a moral dimension too: reckless consumption which could not
be sustained, a disregard for protecting the vulnerable in difficult
times by the discouraging of saving and levels of debt, public and
private, which were quite mad.
Those who have done the right thing, who have worked hard, provided
for themselves and saved are being punished most by government
policy, thus the Conservative unveiling of a package of £4 billion of
proposed tax cuts for savers and pensioners yesterday.
That deft touch of righteous indignation has often been lacking from
the Cameroons, and now their leader appears to be acquiring it.
Cameron's attacks on the PM in the past few days have been more
effective for being slightly angrier.
There is a clear and widening divide between the parties, after a
long period when it appeared that politics was too often just another
feature of the consumerist bubble and the differences appeared to be
relatively slight compared with those of the 1980s. The
Conservatives, not having expected to fight the next election on the
economy (planning, mistakenly, for the continuation of the Brown
boom) are having to adapt quickly, but differences on specific
policies will only grow this year if they are fuelled by this spirit
of moral indignation. "We are entering what kind of country do you
want your children to live in territory," said a source close to the
Tory leader.
Of course, there are significant dangers for those claiming an
abundance of moral authority. As the saying goes: the more
politicians speak of ethics, the more we should count the spoons.
Both John Major and then Tony Blair got into their greatest
difficulties when pleas for improved public morality turned into
embarrassing searches by the press for individual acts of wrong-doing
within their administrations.
And which leader does not think of him or herself as inherently
moral? Even the most careerist politician can usually construct an
ethical sounding rationale for why he does what he does.
But oddly, while so much of the modern political class has become
steadily more obsessed with status, salary, perks, position and
preferment, those involved have declaimed their moral credentials
ever louder as if in compensation for their other failings. There is
now a huge oversupply of extremely bossy individuals elected to local
government, the devolved institutions, the Commons and the European
parliament, who are certain they know what is best for us and can
justify their endless interference as being always in the public
interest and by extension an obvious moral good.
While MPs were distracted banning whatever they could, most missed
the fact that a debt bubble was being inflated and a genuine moral
catastrophe was in the making in the ineptly regulated banks and
Gordon Brown's Treasury and the Bank of England (independent in name
only). Brown's tide of cheap money floated New Labour, created the
illusion of prosperity and secured re-election. The resulting tax
revenues and doubling of public spending, which is money that would
have been better saved by individuals and then used to create more
wealth, paid for the maintenance of a vast empire of social
engineering which has kept the poor imprisoned on welfare in ghettoes
with education inadequate to enable them to clamber out in sufficient
numbers. If that is not immorality in the field of public policy, I
am not sure what is.
So many of the big choices we face at this moment are as much moral
as they are economic. Why should small businesses be taxed out of
existence so that Lord Mandelson can possibly give taxpayer money to
Tata, the Indian owners of Jaguar who make a profit and are about to
sponsor Ferrari? That would be simply immoral. Why should savers who
own their homes pay for the recklessness of those who over-borrowed
and need interest rates to collapse to virtually nothing as a result?
What of the fashion for printing money and loading the debt on our
children in the shape of much higher taxes? If it has any virtue
beyond expediency I would like to hear what it is.
Throughout his career the PM has relied on the idea that in the moral
dimension he has an advantage denied to lesser mortals, framing his
arguments constantly in terms of their innate goodness. Now he is in
the process of finding out that the boot is on the foot of his opponent.
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