The deliberate decision - entirely for electoral reasons - to
postpone taking the axe to public services will cost the country
dear. It could even be the prime cause of the national bankruptcy
staring us in the face, If that bankruptcy occurs it will not just
be the choice of politicians as to where the axe falls - it will fall
on everything indiscriminately. [as I have been repeatedly saying
for nearly 2 years now! ]
The Mail on Sunday has a story that Darling wanted cuts but Brown
refused them and that 'sources close to Brown' were secretly
'briefing' against Brown is superficially dynamite, but lacks any
hard fact 'peg' to hang it on. I was going to forward it but decided
against it.
xxxxxxxxxxxxx cs
=================================
SUNDAY TIMES 26.4.09
(Leader) A shoddy budget from a discredited government
The knee-jerk response to a budget can often be wide of the mark.
Take Geoffrey Howe's austerity budget of 1981; no fewer than 364
economists condemned it, but it turned out to be one of the best
things that Margaret Thatcher's government did. Or Norman Lamont's
1993 budget, which raised taxes and squeezed spending and was so
badly received that he was out of his job within two months. But it
fixed the public finances and set up the prosperity of the 1990s and
beyond.
History will be less generous to Gordon Brown and Alistair Darling
and rightly so. Last week's budget was shoddy and dishonest. At a
time of national economic crisis, with the country crying out for
leadership, Mr Brown chose to play party politics. Not only did he
postpone taking the axe to public spending until after the election,
he also announced a tax rise - the 50% top rate on high earners -
with the explicit aim of skewering the Tories.
The new top rate will not raise enough money to compensate for the
message that it sends to ambitious and hard-working people: "the more
you make, the more we take". Forget the exodus of the rich to
Switzerland, America and Monaco, important though it may be. Many of
the rich reluctantly accept they should pay more tax, but only if
they feel the state is using that money prudently and living within
its means. That bond has been broken, with the private sector taking
almost all of the the pain of the recession. It furthermore
explicitly breaks a Labour manifesto commitment that Mr Brown
solemnly swore to keep four years ago.
This recession is exposing Mr Brown for what he is: an old Labour
party machine politician. He thinks he can reignite class war by
tapping into public distaste for greedy bankers. It may gain him a
bit of short-term political capital, but it is not the mark of a
leader or a man who has the interests of the country at heart. This
budget was the death of new Labour and an end to the Blair era.
There have always been warning signs. Mr Brown wanted a 50% top rate
of tax in 1997 but was blocked by Tony Blair. In the same year he
unveiled his "people's budget", intended to provide "a long-term
commitment to prudent and sustainable public finances" and boost
savings and investment. It contained the £5 billion annual raid on
pensions, which began the process of undermining retirement prospects
for a generation of private sector workers.
So it went on. Triple counting of extra spending on health and
education was followed by an unaffordable splurge. The public sector,
showered with tens of billions of taxpayers' money, did what it does
best - spend on an epic scale. Some things improved; plenty did not.
The public is beginning to see Mr Brown in a new light. The
principled politician now looks unprincipled. Instead of honesty, we
have had dishonesty. Instead of a moral compass, we have had an
immoral and sleazy Downing Street machine. Instead of prudence, we
have had an imprudence rarely seen before in British history.
Commentators have begun to liken him to Richard Nixon, clever but
flawed, angry and willing to use any means to stay in power.
For the people of Britain, the consequences of that imprudence will
be with us for many years. It will take nearly a decade to get public
borrowing to acceptable levels - if the markets allow us that long
[they won't ! -cs]- and until the 2030s to get government debt back
to the 40% "ceiling". Whoever wins the general election, we can look
forward to years of austerity and tax rises. [It will be more than
'austerity' - a better word might be 'penury'-cs]
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