This article in the Times made me smile. Of course Brown was wrong on the recession. He’s wrong on everything
Brown’s social re-engineering agenda has resulted in a bigger than ever gap between rich and poor. But this time it’s different.
There’s a new elite class comprising politicians, hedge funds and public sector professionals.
There’s a new victim class made up of those imprisoned by a combination of failed education system, bankrupt manufacturing sector and a tax and benefits system which entraps them.
And there’s a new poor class. These are the people who work, spend on goods and services, save, give to charity and support the concepts of social justice. Brown’s stealth taxes on just about everything have made these people worse off.
In the last five years of close to zero inflation my car tax has doubled, fuel and energy costs have done the same. Meanwhile my pension and investment portfolios are worth less than half what they should have been.
In that five years some notable politicians have made vast amounts of money trading houses, funded by our taxes in the form of expenses.
Yes – like most working people I’m really pissed off about the way the new elite has feathered its nest while the rest of us paid for it.
Gordon Brown was wrong to suggest that Britain was better placed than its rivals to weather the recession, his Chancellor has conceded.
Alistair Darling came under pressure today to justify the Prime Minister’s claim that Britain would lead the world out of the downturn.
The Chancellor insisted that Britain would return to growth at the end of the year, despite seeing France, Germany and the US all exit the recession first
Asked to accept that Britain was not leading the world out of the downturn, however, he appeared to acknowledge that the Prime Minister was wrong.
“Other countries have come out of recession before us. However, the point I’m making is, I always thought that, so far as our country is concerned, it would be the turn of the year before we saw that,” he told the BBC.
“Our banking sector is a much larger proportion of our economy than it is, say, in France or Germany, so it would take . . . it’s taking us longer to come out but we will come out.”
Today Mr Darling suggested that it remained “madness” to cut budgets now, hinting that there may be a further fiscal stimulus in next month’s Pre-Budget Report.
“We and all the other countries are doing the same thing, we’re putting money in to our economy to support our economy and to take it out prematurely, not to have done so would have been utter madness.”
Until now the Government has shied away from reinforcing areas’ departmental budgets or particular public service spending programmes. The Tories said they will ringfence the budgets of both health and international development.
Mr Darling will set out how Labour intends to protect frontline services in next month’s pre-budget report.
Sources close to the Chancellor refused to comment on reports that there was an additional fiscal stimulus planned as part of the December statement. However last month’s unexpectedly poor GDP figures could encourage the Prime Minister to push for a boost for spending.
Government expenditure is due to rise £30 billion next year to £700 billion because of an increase in the benefit bills and uprating in pensions. Quantitative easing, which is decided by the Bank of England, may also be extended.
Some capital investment in housing and public services is due to fall in real terms. Reports that the Chancellor could reverse this and raise departmental budgets were labelled as “speculation” but the source added that the Chancellor would set out how he intended to protect frontline services.
This could mean freezes in some departmental budgets which were already facing cuts.
The Treasury sought to dismiss speculation of a division between Mr Brown, who has argued for higher spending in the past, and Mr Darling. Reports of a Cabinet meeting last week suggest the Chancellor was arguing that new projects would need to be “paid for by savings elsewhere” while Mr Brown was emphasising the importance of not withdrawing support for the economy.
The Treasury said today: “The Chancellor and Prime Minister are in exactly the same palace: support for the economy now while living within our means.”
Treasury sources also insisted that the Government would stick to its plan to halve the deficit in five years.
Robert Chote, from the Institute of Fiscal Studies, said that there was a “perfectly respectable case for a deeper and longer fiscal stimulus”. He added: “We are almost unique in the G20 in that we do not currently have a stimulus plan for 2010-11.”
He said that such a plan would, however, have to convince the financial markets that the Chancellor also intends to repair the public finances in the longer term.
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