David Cameron's speech this morning was the most encouraging thing I have heard from the Conservative Party in a long time. He said that a public spending splurge now would result in higher taxes later. He noted that Japan had tried increases in public spending to get them out of a long economic malaise during the 1990s. It certainly did not work. The economy grew at less than one per cent a year.
He noted that already Britain could only borrow at a premium rate compared to other countries. If the government tried to borrow even more than it has already, we would find it even more difficult to borrow and at higher interest rates. We could damage confidence and thus damage investment. In such ways, extra spending could actually reduce economic growth rather than increasing it.
He emphasised his long-established policy of keeping the growth in government spending over the cycle below the growth of the economy, thus gradually reducing the debt and the tax rates of Britain and creating a more prosperous society.
It was a speech so sound that it could have come from the days of Margaret Thatcher. Rejoice!
...and here is an article by George Osborne which was similarly welcome.
Posted by James Bartholomew • Indexed in Politics • Tax and growth
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'The NHS is safe in our hands'
Margaret Thatcher.
And you want a return to 'the days of Margaret Thatcher'? By the way, it was the Tories who while they were in office introduced the practice of transferring people from unemployment benefit to sickness benefit in a bid to massage the unemployment statistics. The welfare state you deride has been in existence for 63 years. The Tories have been in power for 35 of those 63 years. They may not have been in government when the Welfare State was introduced but they have done little to reverse it or even to reform it. Do you really want a Tory Party in power? Maybe what you truly desire does not yet exist - i.e: a Libertarian Party.
Posted by: Louise at December 11, 2008 12:44 PM