It’s been a whirlwind week in British Politics – the Chancellor delivered on his commitment to deliver a comprehensive review of UK public spending on time, the future of our Armed Forces in the framework of our cash-strapped economy was unveiled, and a man who admitted to knowing nothing about Economics shouted about some inaccuracies in a budget announcement that had already happened 4 months ago.
But it wasn’t just the former Union-Leader-turned-Shadow-Chancellor making noises about the spending plans. In the spirit of working together for the national interest, his old friends and party backers are proposing ‘French-style protests’ and mass strike action against the cuts (while claiming straight-faced that the cuts, not mass strike action, will be what stifles economic growth) and of course some members of the public are also apprehensive about the future.
Amidst the furore, I think it’s really important that we pause to take a more pragmatic look at what the cuts mean, and what public spending is really all about.
What is it about public spending that’s so important? As a student of economics, I do have to concern myself with spending in its own right; the figures, the effects, the analysis. But this isn’t (or shouldn’t be) this which makes people take to the streets. For most people, public spending is a means to an end; it’s about services, jobs, and how it all affects our quality of life.
It’s understandable why people don’t like the idea of forgoing the services we care about as a result of spending cuts – as Conservatives we’ve seen things shelved that we’ve cared about for years, and we can all be rightfully angry at Labour for their 13 years of profligacy that once again put us in this desperate position. However, more vital is that we spare a thought for the services we’d be forgoing if we didn’t cut now.
Think for a moment what we could do with Forty-three billion pounds this year. It’s an almost incomprehensible figure, so to put it into context, Educating our young people costs just £63bn, and our entire defence budget is £38bn. With that money, we could lift 11 million more people out of paying income tax or stop all businesses from paying corporation tax altogether. Just imagine how far it would go towards higher education.
But we can’t use it for any of these things. Instead, that £118 million pounds every day will be spent just on paying the interest on our Trillion pound national debt. And that still doesn’t make it go away. In fact, every day it gets worse. Every day we wait, another school or hospital or motorway or policeman or helicopter for our brave armed forces is sacrificed, be it now or in years to come. This is the shame of the Labour Government, an appalling affront to the people of this country, and we cannot let it happen for a day longer than we have to.
But what of the economic claims that cutting spending will doom our recovery and plunge us back into recession? Well let us remember that back in June, the emergency budget took fast, decisive action including significant cuts to the unaffordable spending left by the last chancellor. All basic theories would point to a fall in growth, but what happened? Confidence rose, consumption grew, people started investing again, and all growth forecasts had to be revised up. The world saw that we were taking action, and economic cataclysm had been narrowly averted, and the UK economy bucked the trend.
And once again, leaders of the UK’s biggest businesses, potential investors from around the world, and most credit rating agencies and international organizations have come out in support of our actions. Arnold Schwarzenegger even went as far as to say he wants to follow our lead in tackling California’s deficit.
I’ve spent a while trying to think up a good analogy for this whole business, but my favourite remains one a friend of mine said a few days ago, likening the cuts to pulling off a sticking plaster. We can either pull it off slowly, drawing out the pain until it becomes unbearable, or else we can brace ourselves for the worst, rip it off, and find it’s really not as bad as we’d thought. One thing’s for sure, once the plaster’s off and the economy can finally breathe the air of free enterprise once more, the wound left behind by the last government will heal in no time.
Owen V. Williams
BUCF Publicity Officer 2010/11