Gaffe after gaffe, things are turning nasty in the campaign for the General Election due to take place on May 6th 2010. Paradoxically, this is not one of my main worries. I worry a lot more about what could happen after the General Election. Visiting the shops is not, for most of us, a pleasant experience. Very much concerned about ‘household economics’ and having had the experience of living in countries were galloping inflation eats up salaries before you can even get your monies, my main concern is what is happening to the cost of living in Britain.
The Governor of the Bank of England, Mervyn King, has suggested that we shouldn’t trust the figures provided by the Labour government and that government accounts should be audited by the International Monetary Fund as a independent operator. Formulating or implementing new policies is basically impossible if we don’t know the real state of British public finances. This is precisely why the coming General Election is so vitally important. We do not want to end up like Greece where things are turning nastier by the minute.
Let’s keep an eye on the Trade Unions. As soon as cuts are announced and people start losing their jobs, even faster than before, we might (I say we might because I hope it does not happen) have to face General Strikes. One nightmare scenario would be the complete paralization of credit systems in Britain. Do you know how many people live with the monies they get as salaries during the first ten days of the month and then are forced to live on credit cards during the rest of the month? A thousand? Tens of thousands? Hundreds of thousands? Millions?
Noreena Hertz wrote a book entitled ‘The Debt Threat and Why we must defuse it’. She quotes Thomas Jefferson who said on July 21st 1816 ‘I place the economy among the first and most important of republican virtues, and public debt as the greatest of the dangers to be feared’. I assume that Gordon Brown and others, too busy dealing with ideological premises, are so oblivious to the potentially tragic consequences of massive public debt that they keep piling up debt and pretending that default is not even a remote possibility.
Looking at every budget presented to Parliament since Labour came to power, I have had a clear idea of where Labour was heading. We started with calculated borrowing of 10 billion, followed by 24 billion, 36 billion and then it simply kept rising. They calculate that by the end of 2010, borrowing for 2010 would have reached 184 billion.
So the deficit has been there from the very beginning. Every time Gordon Brown has had to explain why his figures do not add up, he has come up with the expression ‘at the end of the economic cycle’, leaving everybody puzzled about when was that ‘at the end of the economic cycle’ going to occur. From the very beginning, Labour has been changing the goal posts. The present financial troubles started in May 1997 when Labour came to power.
Labour believes in an all-powerful State that can squeeze the life out of an entire economy without any major repercussions. Since May 1997, they have been borrowing and squeezing the private sector. In this regard, Marxism is no different from the old French Aristocracy. Why producing anything when you can always borrow? Wasn’t this the philosophy that led to the French Revolution of 1789? They borrowed, borrowed and borrowed becoming weaker and weaker. This is as childish as it is dangerous.
When you see countries like Greece losing their political independence because they cannot afford to repay their debts, you should think about Britain and about what will certainly happen if we do not get rid of Labour’s economic policies.