| Topic: | Re:Re:Re:Re:It's more than just one quarter | |
| Posted by: | Thomas Barry | |
| Date/Time: | 25/04/12 23:46:00 |
| "I agree with every one of your suggestions except the car one, which would mainly drive imports" I think we're a net exporter these days, mainly Nissans and Toyotas but the badge doesn't matter. What matters is reducing the amount of foreign oil that they burn, which has the threefold bonus of putting money back into people's pockets through lower fuel and insurance costs, reducing imports and reducing CO2 emissions. "What about something to encourage bank lending to SMEs?" Certainly, how about 'boost demand by putting money in people's pockets, thus enabling SMEs to present business plans which aren't too risky for the shattered banks to take on'? That's the main reason I put tackling rip-off Britain in there, to shift money from excess retained profits into moving around the economy, which it seems rather obvious to me is required if the necessary boost to the private sector Osborne is bellyaching on about is to happen. In fact any measure that doesn't actively seek to boost people's income is not going to cut it (I forgot to add 'make a firm Government statement that 'trickle down' economics and the Laffer Curve are both henceforth considered as outdated as beige carpets and the Austin Allegro' - we know they don't work, so bin them and invite any Government adviser still clinging onto them to seek alternative employment, preferably on minimum wage). One thing we have to do that I haven't got a solution for is how to increase wages - mandating a massive hike in minimum wage would put up unemployment and hit all businesses, not just those sitting on a cash pile, cutting payroll taxes would hit the deficit and isn't that efficient a way of getting money moving around the economy. One possible option is to make it harder to fire people, for two reasons: 1) it's what the Tories wouldn't do and 2) it would boost consumer confidence if we weren't all worrying about the P45. The unspoken structural reason for the recession is that for thirty years we've had a policy of a) making people relatively poorer by bearing down on wages and b) making them pay for more things by eroding the welfare state, privatising railways etc. It's pretty obvious to me that relying on household spending to turn the economy around when we're experiencing high inflation with a tight squeeze on wages is fruit-loop bonkers. |