(Original post by marcusfox)
Despite all the claims to the contrary, the coalition’s deficit reduction plan is, just about, still on plan A.
Reducing government deficit is like turning around a container ship, the instruments to make it happen are adjusted but the response is never immediate.
It always was planned that borrowing would have to increase in the short term.
Lest you haven’t noticed, our economy is on its knees and all taxation does in that situation is act like a great big kick in the *******s.
The coalition had very little room for manoeuvre but has quite rightly cut those taxes that are worst for stopping business growth.
Corporate taxes have always been bonkers and high rate tax was cut because it wasn’t working - end of story.
The argument against higher rate taxes is one that’s generally accepted most of the world over nowadays and cutting them has always raised more revenue than it costs.
Indeed, that probably goes for most taxes and, deficit willing, with the Tories now back in office, maybe one day we can return to those far off golden (pre- Brown) days when we could look forward to, year on year, yet another round of tax cuts for all and the increased prosperity for all that always seems to go with it.
The coalition’s plans to pay down the deficit included a period where overall debt would still rise.
This is because of the time lag involved in making the spending cutbacks.
The debt is still going up, and will do for a while yet, but importantly the deficit, the gap between what we earn and what we spend, has come down significantly.
The coalition inherited a public sector that still had to be paid for, even if it was of a size that was unsustainable and that they would have preferred to be far smaller.
This is because Labour, rather than facing up to economic reality, chose instead to put their own narrow selfish interests first, by post dating all the bad news until after the election.
Brown had three years to address the deficit but did nothing and we all know why.
His own party, friends, colleagues, our very democracy even our economy being reduced to a basket case, all was expendable in the name of achieving his divine right to rule.