I preferred the article in the Reuters release. According to Reuters the National Institute for Economic and Social Research, which they describe as “non-partisan” has stated :
“The reason why there is a bias towards a spending-based consolidation in the UK … is not because it’s optimal in some sense, but because some politicians have a desire for a smaller state”
So there you have it, the cuts have nothing at all to do with the state of the economy and are primarily driven by idealogical considerations – but we already knew that didn’t we ?
They also said :
“There is no real evidence recently that spending-based consolidations are more effective than tax-based consolidations, at least in advanced European economies”
So in other words the Tory/LibDem 80/20 percent argument, ie 80% in cuts and 20% in tax increases, is simply just bollox.
Finally they say :
NIESR forecast that unemployment would rise further in 2011, peaking at 8.8 percent of the workforce in the third quarter. Due to lasting damage from the financial crisis, it was unlikely to fall below 6 percent in the long run compared to an underlying rate of 5 percent beforehand.
Real disposable income would also fall to a five-year low by the end of 2011 due to limited wage increases, higher taxes and inflation
It’s gonna be grim ………… best demo on 26 March and try and stop the feckers then. And don’t believe that the coalition isn’t for turning – they are if public opposition is big enough. But obviously not if they think they can get away with it.
http://uk.reuters.com/article/2011/02/01/uk-britain-economy-niesr-idUKTRE71001D20110201?pageNumber=2
