Friday, 7 September 2012

Why I support austerity

I recently attended my local preacher meeting, during which there is always an update on the church who is hosting it. This particular church had started providing emergency food aid (in partnership with others) to those in need in there local area. I was a little surprised, as the area in which this church stood, was not deprived or disadvantaged. It was a small town in south East England and food aid was required.

So why do I support the policy causing this food aid?

Firstly I must admit that this is the outcome I would expect. Food scarcity is always the outcome of increased global consumption and local recession. In a time of resource constraint I would expect those in the worse economic position too feel it more then those with greater accesses to resources.

This is not to blame those forced by forces far beyond them. To say that before the crash the country, the household and the individual overspent. If a person who is employed lives in debt they will be utterly destitute if they should loose there job. This is the situation many people have found themselves in.

One of the causes of this overspend is of course the fall in real terms wages but a vain attempt attempt to maintain current living standards. I often compare this to a impoverished Emperor , who is fooled into thinking thin air is the most fashionable robes and then buys them. He is foolish twice, once to buy thin air and the second time to use money better used else where (in paying of his debt perhaps).

We could argue who fault all of this is but we our faced with it none the less. Both the nation and the individual overspent and massively and for very little tangible outcomes. I concede there was useful spending as well for example new hospitals and school buildings. I however submit a new hospital operates just as well if not designed by an award winning architect. It was exactly this vane spending to which I refer. Infrastructure spending is one thing but no nation is enriched by modern, initiative buildings just functional ones.

So we our left with no money to spend. We have rather pleasant looking but empty visitor centres and people starving because they themselves lived of debt in the good times and I support the policy effectively pulling the plug on all the spending that partially supported this?

Yes and Yes again

One of the first effect of the global melt down was for good or ill the fortunes of Britain where held by the dreaded rating agencies. Effectively, Britain is owned not by its people but its debt holders and if the APR (Bond yields) where to raise too far BANG! At best ,massive devaluation of sterling (which would massively increase the cost of imports) and at worse Bankruptcy and who would be able to bail out the UK? Who?

So why not increase our tax take to pay off our debts and build some more pleasing ornate buildings? Why not? The required businesses people and investors we so desperately need would simply leave. We our beggars, not masters, we need them far more then they need us. Oh we could threaten to freeze them out of the UK but such an anti business anti free market move would end any chance of recovery and make Ukplc UK on the Volga.

No the bitter pill is this, without the ability to borrow more money for fear of the credit ratings and without the ability to tax people more without causing a flight of international capital we are ensnared. We must cut expenditure and do what ever private capital wishes in order to get there money voluntarily. I would say that there are far better target for cuts then the poor but they our either protected by government or by the electoral will of the people. No we must cut spending and pay off our debts, like those who our blessed to still have a job.

The UK must look beyond the EU for trading opportunities, shaking hands with anyone willing to spend a few pennies in the UK. Indeed placating Latin America with over various issues would be a good start. We our beggars remember and it is time we acted like them. Oh and by the way I know dealing with murders and corrupted people is not easy but neither is seeing people beg for emergency baskets.  

No comments:

Post a Comment