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The problem with politicians is that they court popularity

So Lord Mandy is today lambasting the Conservative Leader for economic illiteracy as Labour still promises to halve the budget deficit within four years, Cameron initially appeared to favour swift sharp cost cutting with George Osborne (but ring fencing the popular parts of the state), then he dithered and suggested that so long as we make a start that’ll be alright – oh do come on, both of you!

We all know that the budget deficit built by Brown is far too huge to maintain, we all know the national debt is an utter embarrassment and a millstone around our necks, the markets know that current spending plans simply cannot be sustained without tax increases. What most of us passed over without noticing last weekend is that Britain’s credit worthiness is being damaged, our banks and public finances are seen a s a greater risk by international markets, Standard and Poors have downgraded our ratings. Unless politicians get an immediate grip on the spending problem and stop borrowing to spend, banks will have to start charging higher interest rates to lend money to each other and government, this will cause higher interest rates for small and medium sized enterprises when they are lucky enough to get a loan from a bank. Higher interest charges will lead to poorer investment, and even fewer jobs, and the downgrading has already led to pressure on the pound making life even harder for our exporters.

Gordon Brown’s stewardship of the economy has seen over £trillion printed and pumped into the financial sector, saddling our grandchildren with public debts that they won’t even have known existed, as well as being the last major economy to drag itself out of recession (and the jury is still out on that one), gold reserves depleted prior to a massive hike in values, pension schemes robbed of future value, and now a national credit worthiness worse than places such as Chile, Portugal, Belgium, and Italy.

It’s high time that our politicians stopped fishing around for the soft easy votes and laid out the facts, openly, honestly, and candidly, our economy is in a debt spiral still, and the only way to make headway in reducing the debts is to bring an end to much of the spending, This plain truth is evident to everyone who has struggled with their household budgets during this long Labour induced recession, so it ought to be just as obvious to political leaders on both sides of the divide. They need a steely nerve to make tough immediate decisions, they need to face the fact that we are not out of recession yet and that a 0.1% growth rate is the swallow that doesn’t make a spring or summer (and even that figure is a best estimate.)

With an election on the way the likes of Brown and his master Mandelson will continue to talk of a double dip recession whilst Cameron and Osborne wrangle over painfully obvious options should they take power, the truth is simple, removing some of the support from the economy will make life tougher, doing nothing for a while will drive up interest rates further and make it even harder to promote growth and slow recovery too, but it has to be done. There is no credit to be gained by shying away from the truth.

Popularity may well win a few friends but popularity does not of it’s own make a good politician.

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Written by curly

February 1, 2010 at 3:33 pm

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