Monday, Aug 16, 2010
A spending review is under way and results will be announced on October 20
Reuters: Spending cuts risk turning into demolition job
The government may find it hard to stick to a coherent strategy as ministries scramble to cut spending by up to 40 percent on Treasury orders.
Prime Minister David Cameron, who took office in May, says shrinking the record peacetime deficit from 11 percent of GDP to almost nothing within five years is the most urgent task for his Conservative-Liberal Democrat coalition government.
Posted by mark @ 10:00 AM (648 views) Add Comment
5 Comments
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1. miken said...
A saving of 150bn (per year) over 5 years is an awful lot of money to save. Let's say of the ~150bn (per year deficit) that the average wage is an optimistic 40k then that's approximately a loss of 3.75million jobs! They are also effectively taking 750bn out of the economy over 5 years. There's going to be many additional homeless coming onto the streets. I predict these cuts will cause a recession that will be worse than the last one.
2. sovietuk said...
"There's going to be many additional homeless coming onto the streets"
No - you get housing benefit or move to a cheaper house or start a business and do something constructive with your redundancy pay (maybe diffcult for some one jobsworths).
3. tyrellcorporation said...
'They are also effectively taking 750bn out of the economy over 5 years.'
Don't confuse the economy with the state. £750bn saved can then be offered as tax incentives to private businesses and individuals alike. I can guarantee that £750bn will be spent more wisely by private individuals than it would be governments. Proper stimulus to create a sustainable recovery and NOT a series of ill considered government job creation schemes and initiatives.
4. miken said...
@2 that's an awful lot of people who may need to move to a cheaper house. That's assuming they are able to move if they aren't in negative equity.
@3 I agree that money can be better spent by the private sector who should have more incentive to innovate and create more jobs.
5. iguana said...
OK, lets have a coherent stategy,
This is not our debt, it is the banks debt. We are being asked to loose the already depleted social provision that we have paid dearly for, everyone young and old is being compelled to pay more and receive less or nothing. Let us strategically and coherently ensure that the b..y banks are put in a vice and squeezed until the pips squeak and their debt to us is repaid with interest.