Thursday, 22 March 2012

Fiddling in the shadow of a debt mountain

Daily Mail
"There is virtually nothing in the Budget, either, to beef up a recovery that’s being driven by increased exports (a result of the 20 per cent devaluation of the pound against foreign currencies) or to place real muscle behind the kind of technological and research-based enterprises that are giving such a lift to the economies of America, China and India. Received wisdom is that initiatives such as those were absent because Osborne has so little room for political manoeuvre thanks to the push-me-pull-you nature of the Coalition. But the real reason is starkly revealed in the Budget Red Book that outlines the economic figures behind his public announcements. It’s true that if Mr Osborne can deliver further cuts – including the £10billion of savings from the welfare budget mooted yesterday – then the proportion of national output eaten up by public spending will fall from 48 per cent now to 40 per cent in four years’ time. But the reality is that for all the talk of austerity, government spending is growing inexorably, and is projected to rise year by year from £688billion in 2012 to £756billion in 2016, giving the lie to all the talk of savage cuts".

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