The Futility Monster

He'll pointlessly derive more enjoyment out of your resources than you

The Strains Of Coalition

Posted by The Futility Monster on June 19, 2010 @ 09:43

Stolen from ConservativeHome.com, but drawn in 2007! Prophetic...

In recent days I’ve been troubled by the cover the Lib Dems are being forced to give to the Tories for the “cuts now” agenda. In truth, I’m probably deeply unsure myself, having argued in the past that we do need to make mega cuts in budgets all over the place, before then saying that those very cuts would do serious damage.

But now I feel quite certain. The economy is still in the tank. Cuts now are definitely going to create the W shaped recession we were all afraid of. The private sector is not sitting on its hands, waiting for the moment 20% is cut off all government department budgets to spring into action. The concept is laughable.

The consequence is that inbetween the cutting and the beginnings of genuine recovery in the private sector, there simply is going to be more of an economic decline.

The seriously worrying part of this, as a Liberal Democrat, is that the party is backing it 100%, and is completely tied into it with its Man in the Treasury, and coalition agreement pledging to be pretty radical with the scissors.

Last night, a Liberal Democrat MP, never mind a Cabinet minister, wouldn’t even appear on Newsnight to defend the agenda. Instead, it was left to former MP Susan Kramer, who was tied up in knots by Gavin Esler and even Ed Miliband over the pre-election opposition to “cuts now” compared with our new position of “why haven’t we started cutting yet?”.

There are some mutterings of discontent on the Lib Dem backbenches, but that’s no surprise. And though there’s still five years till the next election (apparently) early Lib Dem poll ratings are very poor indeed relative to our election performance, and considering all the pollsters massively overstated us in the run up to May 6.

If I’m wrong, and the government is right, and it manages to cut carefully without stoking another recession, and without punishing the poorest in society, then I’ll hold my hands up and admit it.

But right now, with the ideological love of a smaller state on the Tory benches, combining with the libertarian economist streak that is emerging from the Orange Bookers in the Lib Dems, it seems to be creating the perfect storm for a groupthink mentality, coalescing around a slash-and-burn programme.

And that may be exactly like standing on the grasping fingers of a man clinging for dear life on the cliff precipice.

Oh, the next 12 months will be worth watching…

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One Response to “The Strains Of Coalition”

  1. Neil Craig said

    The argument being used by Labour now is that “growth rather than cutting the deficit2 should be the priority & that government cuts means cutting growth. The first part is certainly right & the 2nd equally certainly wrong. At 53% of GNP the state, whose net contribution to the economy is negative, must be cut. It would be better if much of the cuts are used to redistribute to the productive sector & while cutting government borowing does have some effect that way cutting things like corporation tax should have a priority even over elimination of the deficit.

    Over the last decade the world has had average growth of 5% & the best economies of 10%. There is no excuse for us having only 2.5% at the best. The main way to achieve growyh is by cutting the parasitic effect of government – housing & electricity both cost 4 times more than they need to & the H&S regulators destroy the work of 4 million productive workers. Cutting those regulatory burdens woyuld not only take many 10s of billions from expenditure but would also, in itself, put us into fast growth.

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