Sorry if this is a gloomy piece. However, I think we should discuss the real state of Britain and not some fairy tale version of 'recovery' currrently being touted by the Tories.
I liked this phrase - "
Alice in Wongaland" - dreamed up Ann Pettifor of Prime Economics, a think tank - she says that the current 'recovery' in consumer spending and therefore major areas of the economy like retailing and services is unsustainable, as real incomes are continuing to fall. People are simply continuing to borrow too much.
http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/10244365/Summer-heatwave-triggers-shopping-spree-in-Wongaland-economy.htmlIt seems that with interest rates continuing at rock bottom, there is no incentive to save - and with inflation persisting and real incomes falling, a huge informal tax is being applied to the population to devalue government debt and (presumably) maintain the fiction that the banks are back in business. The reality is that they still represent a dire threat to every citizen in the UK as they are still too big to be permitted to fail.
Overall, the picture continues to be gloomy. Unemployment has been kept lower by forcing down wages and marginalising millions of workers on casualised, zero-hours contracts. Pensions are in a total mess - private pensions have been systematically milked by fees and hedge funds. Only buy-to let landlords, egged on by the government, have a theoretical chance at decent retirement income, provided that property prices continue to escalate, due to too few houses being built and too many people chasing housing with insufficient funds.
Utilities are being allowed to milk customers, with weak regulation and constant price increases. Alleged 'free markets' in energy do not exist, but are manipulated by the utilities corporate owners and allies.
The difference between what actually needs to happen and what is happening is huge. What should be happening is:
* Banks should be broken up into retail and investment operations, as they used to be. If the banks want to run casino operations, they shouldn't be permitted to do it at risk to taxpayers. Coalition response: NOT HAPPENING. Blather about internal ringfencing. Regulation if anything being weakened.
* Large house building programmes are needed in the public sector and for Housing Associations. Coalition response: NOT HAPPENING. Some minor modifications to local authority rules, but it remains chronically underfunded.
* There should be state control of major public resources like energy, rail and broadband that are currently all being delivered at constantly increasing prices and with no or insufficient improvement in quality. Broadband lags behind other countries. Rail is the most expensive in Europe. Energy prices have increased dramatically causing widespread hardship and squeezing the economy. Coalition response: NOT HAPPENING. Blather about 'shopping around' is their usual mantra. In reality there are no options for consumers. Expensive, ineffective infrastructure projects like HS2 are taking up the available money.
* Taxes - tax havens should be shut down, businesses trading in the UK should be forced to pay taxes here on their turnover and clever methods of offshoring taxes via fee transfers abolished. Large IT corporations like Apple, Google and others that refuse to pay taxes should be prevented from operating here without a special tariff, designed to replace the lost tax income. The UK should be going along with the EU's efforts to deal with this. Coalition response: NOT HAPPENING. Lip service is paid to tax haven reform but the reality is that no serious action is taken. Tories are deeply in bed with Google and unwilling to work against their financial interests.
Perhaps even more depressingly, Labour currently have no worthwhile policy answers on the above.
We need a new Labour leadership and a clear programme to get us out of this dismal hole. David Cameron, Nick Clegg and George Osborne are unwilling to do this because they are in hock to private interests. Ed Milliband seems unwilling to do it because Labour are also still tied up in kowtowing to some large corporate interests.